A Member of Pat McKeough’s Inner Circle recently asked for his advice on Allegion Plc, a global leader in security and access solutions to secure homes, businesses, schools, and institutions around doorways and adjacent areas.
Pat likes the firm’s diverse portfolio of leading brands, its global presence, and solid strategic acquisition strategy. And while it operates in a competitive market, the company’s well-established product lines appeal to a growing number of consumers worried about safety and security.
Allegion plc, (Symbol ALLE on New York; www.allegion.com), sells security products and solutions in 120 countries.
The company is based in Ireland for tax purposes, but it has regional corporate centres in Carmel, Indiana; Brussels, Belgium; and Shanghai, China.
Allegion sells to commercial, institutional, and residential end-users. Its markets include education, healthcare, government, hospitality, retail, office, and residential.
The company sells more than 30 brands, including segment leaders such as CISA, Interflex, LCN, Schlage, Simon Voss and Von Duprin.
Electronic security products and access control systems make up Allegion’s largest product line. Those wares include electrified locks, electrified door closers and exit devices.
Allegion’s second-largest product line includes locks, locksets, portable locks, and key systems. These comprise a broad array of cylindrical, tubular, security levers and master key systems.
Door controls and systems and exit devices are installed by Allegion on fire doors and building entrances and exits. Exit devices, also known as panic hardware, let building occupants exit in an emergency.
Doors, accessories, and other products include hollow metal, glass, and specialty doors, as well as security products and components.
Services and software made up the remaining revenue. Here, the company offers inspection, maintenance, and repair services for its automatic entrances. It also offers software services to manage workforces.
Allegion aims to keep investing to create new, innovative products and services that complement its core offerings. For instance, in June 2024, the company announced that its Zentra brand had made residential keys that work with Apple Wallet. This lets residents access their buildings with a tap of their iPhone or Apple Watch. That eliminates physical keys, making life easier for property managers and residents.
Allegion: Strong quarterly results bode well for the future
In the three months ended March 31, 2025, Allegion’s revenue rose 5.4%, to $941.9 million from $893.9 million a year earlier. Excluding one-time items, Allegion earned $161.2 million, or $1.86 a share, in the quarter. That was up 17.8% from $136.9 million, or $1.55 a share.
The company operates in a competitive market, with big multinational rivals that include Assa Abloy AB, dormakaba Group, and Fortune Brands Innovations. Still, Allegion’s well-established product lines appeal to a growing number of consumers worried about safety and security.
In the near term, the company’s residential markets in the U.S. are likely to remain sluggish, but its sizable presence in institutional markets, focused on schools and healthcare facilities, should continue to lift sales.
Technological advancements should also provide room for Allegion to expand its business. These include touchless and other solutions that promote health and make the user’s experience easier.
Allegion raised its quarterly dividend by 6.3% with the March 2025 payment, to $0.51 a share from $0.48. The stock yields 1.4%.
The company’s shares trade at a reasonable 18.2 times its likely 2025 earnings of $7.82 a share.
Recommendation in Pat’s Inner Circle: Allegion plc is a buy.
