ALLE - Embedded Expectations Analysis - 2021 05 21
Allegion plc (ALLE:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 29.9x Uniform P/E, implying bullish expectations for the firm. However, management may have concerns about their construction business growth, Americas segment revenue declines, and order momentumSpecifically, management may lack confidence in their ability to enable direct-to-fridge
grocery delivery for apartment residents, maintain new construction activity, and sustain profitability in their electronics business. In addition, they may lack confidence in their ability to keep up with construction demand and sustain residential business growth. Furthermore, they may be overstating the capabilities of their CBORD partnership, the growth potential of seamless access, and the potential of their investments in Interflex and SimonsVoss. Management may also be concerned about the sustainability of the market recovery in their International segment, the continued impact of COVID-related shutdowns, and revenue declines in the Americas segment. Finally, they may be overstating their order momentum, particularly in wholesale distribution, as well as the potential of their spectrum quotation activity
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