Allegion (NYSE:ALLE) shares surged more than 8% in premarket trading on Thursday after the security products manufacturer reported second-quarter earnings and revenue ahead of Wall Street expectations while increasing its full-year adjusted earnings outlook.
The stronger results were driven by solid organic growth and expanding margins, particularly across the company’s Americas business.
Allegion reported adjusted earnings of $2.40 per share for the second quarter, comfortably exceeding analysts’ consensus estimate of $2.21.
Revenue increased 12.7% year over year to $1.15 billion, surpassing market expectations of $1.12 billion and improving from $1.02 billion in the same period last year.
Following the results, the company’s shares climbed around 8% in premarket trading.
Allegion raised its full-year 2026 adjusted earnings forecast to a range of $8.85 to $9.00 per share, reflecting confidence in continued operating momentum.
However, its reported earnings guidance of between $7.95 and $8.10 per share remained below the analyst consensus estimate of $8.79.
President and Chief Executive Officer John H. Stone said, “Allegion delivered a strong quarter driven by organic growth and margin expansion in the Americas.”
He added, “As a result, we are raising our company’s full-year outlook for revenue and adjusted EPS.”
Organic revenue increased 6.9% during the quarter, supported by higher sales volumes and favourable pricing.
The Americas segment delivered revenue growth of 11.8%, including organic growth of 8.9%, with both residential and non-residential businesses posting high-single-digit gains.
International revenue increased 16.2%, although organic revenue declined 1.2% as demand weakened across key European markets.
Adjusted operating margin expanded to 24.2% from 23.7% a year earlier, benefiting from improved operating leverage, pricing and productivity initiatives.
The company also increased its full-year revenue growth forecast to between 7.5% and 8.5%, while maintaining expectations for organic revenue growth of 3.5% to 4.5%.
Available cash flow for the year to date totalled $260.8 million, down $14.6 million from the prior-year period, primarily because stronger late-quarter sales resulted in higher accounts receivable.
During the quarter, Allegion repurchased approximately 0.9 million shares for $120 million as part of its capital return programme.
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