Allegion Gears Up to Report Q3 Earnings: Is a Beat in the Offing?

Allegion plc ALLE is scheduled to release third-quarter 2025 results on Oct. 23, before market open.

The Zacks Consensus Estimate for ALLE’s third-quarter revenues is pegged at $1.04 billion, indicating growth of 7.1% from the prior-year quarter’s figure. The consensus mark for earnings is pinned at $2.21 per share, which has increased a penny in the past 60 days. The figure indicates growth of 2.3% from the year-ago quarter's figure.

The company delivered better-than-expected results in each of the trailing four quarters, the earnings surprise being 7.9% on average. In the last reported quarter, its bottom line beat the consensus estimate by 2%.

Let us see how things have shaped up for Allegion this earnings season.

Factors Likely to Have Shaped ALLE’s Quarterly Performance

Allegion’s Americas segment is expected to have performed well in the third quarter, driven by stable demand across end markets like education, healthcare, government, hospitality and retail. The increase in demand for non-residential products is anticipated to have augmented its top-line performance. We expect organic revenues from the segment to increase 3.2% year over year in the quarter.

Allegion International segment’s performance is likely to have been augmented by solid demand for its electronic security products and effective pricing actions. However, lower demand for mechanical products is expected to have hurt the segment’s performance. We expect the segment’s organic revenues to remain flat in the quarter on a year-over-year basis.

Allegion has remained focused on expanding its product offerings and market presence through buyouts. In July 2025, it acquired ELATEC, including Elatec GmbH and other group entities (ELATEC), from Summit Partners. ELATEC’s expertise in RFID readers and credential solutions enabled Allegion to expand its global electronics portfolio in non-residential markets. The buyout of Novas Hardware in June 2025 enabled the company to boost its door hardware portfolio.

In April 2025, ALLE also acquired Trimco Hardware, along with its brands and various assets, through one of its subsidiaries. The inclusion of Trimco’s expertise in speciality solutions, coupled with its strong innovation capabilities, enabled Allegion to boost its door and frame portfolio within the Americas segment. The buyouts are expected to have boosted Allegion’s top line in the quarter.

However, rising operating costs, owing to high material costs and investments in new products, channel development and growth initiatives, are expected to have affected the company’s bottom line. We expect ALLE’s cost of sales to increase 3.1% year over year and the net income margin (adjusted) to decline 120 basis points to 18.4% in the third quarter.

Also, given the company’s extensive geographic presence, its operations are exposed to foreign exchange headwinds. A stronger U.S. dollar is likely to have hurt Allegion's overseas business.

Allegion Price and Consensus

Allegion price-consensus-chart | Allegion Quote

Earnings Whispers

Our proven model predicts an earnings beat for ALLE this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as elaborated below.

Earnings ESP: ALLE has an Earnings ESP of +1.24% as the Most Accurate Estimate is pegged at $2.24 per share, which is higher than the Zacks Consensus Estimate of $2.21. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: ALLE currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Here are some other companies, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.

Illinois Tool Works, Inc. ITW has an Earnings ESP of +0.35% and a Zacks Rank of 3 at present. ITW is slated to release third-quarter 2025 results on Oct. 24.

Illinois Tool’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 2.3%.

Stanley Black & Decker, Inc. SWK has an Earnings ESP of +3.59% and a Zacks Rank of 3 at present. The company is scheduled to release third-quarter 2025 results on Nov. 4.

Stanley Black’s earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 57.3%.

Sealed Air Corporation SEE has an Earnings ESP of +1.28% and a Zacks Rank of 2 at present. SEE is slated to release third-quarter 2025 results on Nov. 4.

Sealed Air’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 19.1%.

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This article originally published on Zacks Investment Research (zacks.com).

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