What Happened?
Shares of security hardware provider Allegion (NYSE:ALLE) fell 7.7% in the afternoon session after the company reported fourth-quarter earnings that missed Wall Street estimates and issued a weaker-than-expected forecast for the full year 2026.
For the quarter, Allegion's revenue of $1.03 billion was in line with expectations. However, its adjusted earnings of $1.94 per share fell short of the consensus forecast. The company's financial guidance for the upcoming year also disappointed investors. Allegion projected its full-year 2026 adjusted earnings per share to be in the range of $8.70 to $8.90. The midpoint of this range was below the prevailing analyst estimate, signaling a more cautious outlook than the market had anticipated.
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What Is The Market Telling Us
Allegion’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock gained 4.5% on the news that the security products manufacturer posted strong second-quarter results that beat analyst expectations and raised its full-year financial guidance.
The company announced second-quarter revenue of $1.02 billion, marking a 5.8% increase year-over-year and surpassing the $1 billion milestone for the first time in its history. Allegion's adjusted earnings per share (EPS) of $2.04 also exceeded Wall Street's consensus estimate of $1.99. Bolstering investor confidence, the company lifted its full-year 2025 financial outlook. It increased its adjusted EPS guidance to a new range of $8.00 to $8.15, which was notably above the prior analyst consensus of $7.85. Furthermore, the company raised its expected revenue growth for the year to between 6.5% and 7.5%.
Allegion is up 2.6% since the beginning of the year, and at $165.04 per share, it is trading close to its 52-week high of $179.77 from February 2026. Investors who bought $1,000 worth of Allegion’s shares 5 years ago would now be looking at an investment worth $1,510.
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