Allegion Stock Surges 10.3% on Strong Q1 Earnings Report

Allegion's stock rose by 10.3% following its first-quarter earnings report, buoyed by consistent EPS guidance and revenue growth despite challenges in the residential sector.

Date: 24-04-2025

AI Rating: 7

Allegion's Monthly Performance and Future Guidance
Allegion (NYSE: ALLE) recently reported a 10.3% rise in its stock following the release of its first-quarter earnings report. This rally was primarily driven by the company maintaining its full-year guidance for adjusted EPS of $7.65-$7.85 and mid-single-digit revenue growth. Such guidance provides investors with confidence amid an uncertain economic landscape influenced by high-interest rates and trade tariffs.

The report outlines the challenging conditions facing Allegion, particularly within the residential housing market, which is experiencing a mid-single-digit revenue decline. However, this downturn has been balanced by robust growth in its nonresidential segment, which has risen at a high-single-digit rate. Notably, the company’s web-enabled electronic lock sales contribute positively to its performance, reflecting a low double-digit sales increase in this category.

Another significant highlight is Allegion’s ability to realize price increases, which combined with volume growth, resulted in a solid 4.9% increase in organic sales. This growth is encouraging as it indicates that the company is effectively managing inflationary pressures associated with increased supply chain costs, particularly the estimated $80 million in tariff-related expenses expected to impact the company in 2025.

With the stock trading at under 18 times the midpoint of management's 2025 EPS guidance, it is regarded as an attractive investment for those who see long-term potential in the electronic security segment. Maintaining operations in a favorable industry position with technology integration could yield significant long-term benefits.

Stocks: ALLE