Allegion plc (ALLE) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Allegion plc

Updated on October 23, 2026 · accounts published on October 22, 2026

Reading of October 22, 2026: A high-return industrial business with record margins and strong cash conversion

Allegion trades at a P/E of 22.0× over the last 12 months, 16 % below its sector median of 26.2× and 8 % below its ten-year median.

• Is Allegion expensive or cheap? At a P/E of 22.0×, Allegion trades 16 % below its sector median and was cheaper only 36 % of the past decade.
• How is the business doing? The fiscal 2025 operating margin of 21.1 % was the highest in 12 years, against an average of 18.7 % since 2014.
• How strong is the balance sheet? Net debt was 1.9× EBITDA in fiscal 2025, well under the 3× industrial threshold, and the dividend rose for 11 years running.
• What to expect from the next earnings? Analysts expect EPS of $2.27 for the report due February 16, 2027; Allegion beat estimates in 6 of the last 8 quarters.
• Does Allegion turn its margin into cash, and at what multiple of the cycle? Free cash flow equaled 107 % of net income in fiscal 2025, above the 85 % that marks a healthy industrial.

Is Allegion expensive or cheap?

Over the last 12 months Allegion trades at a P/E of 22.0×. That is 8 % below its ten-year median of 23.9× and 16 % below the 26.2× median of its sector. Over the past decade the multiple ranged from 15.7× to 46.4×, and the stock traded lower than today only 36 % of the time. The current level sits in the cheaper half of its own history but is not a low. EV/EBITDA of 15.9× compares with a seven-year average of 17.9×. Buyers get a free cash flow yield of 5.1 %, with the shares 1 % below their 52-week high of $179.77.

How is the business doing?

Revenue grew 7.8 % and EPS 9.1 % over the last 12 months, so profits are rising slightly faster than sales. The operating margin stands at 21.5 % over the last 12 months. That is above the 18.7 % average for fiscal 2014-2025 and even above the fiscal 2025 record of 21.1 %. Allegion stands out most on return on capital. ROIC of 16.5 % over the last 12 months is 7.6 points above the 8.9 % median of its sector, and it has stayed above 10 % in each of the last ten fiscal years. ROE of 31.1 % also reflects a balance sheet that uses debt, with debt to equity of 0.78.

How strong is the balance sheet?

Net debt came to $23.56 per share in fiscal 2025, about 13 % of the current price. That is 1.9× EBITDA, below the 3× that counts as healthy for an industrial. Over the last 12 months debt to equity is 0.78 and the current ratio is 1.90, and an Altman Z of 4.7 sits in the safe zone above 2.99. The dividend yields 1.2 % and has grown for 11 consecutive fiscal years. The payout was only 27 % of fiscal 2025 earnings, which leaves room to keep raising it. A Piotroski score of 6 of 9 is solid, one point short of the high-quality bar.

What to expect from the next earnings?

On October 22, 2026 Allegion reported EPS of $2.60 against $2.50 expected, a 4 % beat, and it has topped estimates in 6 of the last 8 quarters. The 2026 EPS consensus barely moved over the last 30 days, from $8.95 to $8.97 across 7 analysts, and revenue estimates were also flat, so expectations are stable going into the next report. Of 23 analysts, 8 rate the stock a buy, 15 a hold and none a sell, a cautious stance given its record of beats. The next report is due February 16, 2027, with $2.27 of EPS expected.

Does Allegion turn its margin into cash, and at what multiple of the cycle?

Industrials are semi-cyclical, so a single year's earnings can flatter or punish the stock. What matters is the operating margin, how much of it becomes cash, and the multiple across a full cycle. Allegion's fiscal 2025 margin of 21.1 % clears the 12 % healthy mark, and free cash flow reached 107 % of net income. Its P/E of 22.0× is below 90 % of its ten-year average of 26.4×, and EV/EBITDA of 15.9× is below 90 % of its seven-year average of 17.9×. The one miss is capex at 2.4 % of fiscal 2025 revenue, under the 4-8 % range. That points either to a capital-light model or to underinvestment, and the data does not say which.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.