Allegion: Stronger Demand Opens The Door To More Upside

Allegion delivered strong Q2 results, accelerating organic growth, expanding margins, and raising full-year guidance, justifying its 13% post-earnings rally. ALLE's Americas segment showed broad-based strength, with high-single-digit growth in both residential and nonresidential markets and a 30.1% adjusted operating margin. A durable installed base and leadership in electronic access underpin industry-leading margins and provide a multi-year growth runway beyond the current construction cycle. At ~16x next year's earnings, ALLE's valuation is reasonable given its superior growth, profitability, and earnings visibility; I rate the stock a Buy. Allegion ( ALLE ) jumped around 13% after the company reported a strong second quarter and raised its full-year guidance. The size of that move could make the stock look like one to avoid chasing, but the