Value
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 5.5 |
| P/S | 7.8 |
| EV/EBITDA | 2.1 |
| Fwd P/E | 6.8 |
| PEG | 4.4 |
| Analyst target | 3.0 |
- ▸Forward P/E: 18.9x
- ▸PEG: 2.10
ALLE · Why this verdict
Why Allegion (ALLE) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.8/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Allegion is a high-quality business with 34% ROE and strong margins, but the price is above the analyst target and technically overbought, limiting near-term upside.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Return on equity of 34%, margins near 16% and a Piotroski score of 8 of 9 mark a high-quality business. Quality breakdown | ROE stays above 25% over the next 12 months. | →Stable |
| CounterReturns may be flattered by leverage rather than operating strength. | ||
Quarterly revenue rose from about $1.03B in late 2025 to $1.17B in the September 2026 quarter. Earnings | Quarterly revenue stays above $1.1B. | →Stable |
| CounterEarnings were split with two misses and two beats, so margin pressure may offset sales growth. | ||
The $186.44 price is above the $167.59 analyst target by about 10.1%, leaving no upside to target. Targets | Price consolidates toward the target or targets rise. | ↓Deteriorating |
| CounterThe stock is 1.7% from its 52-week high with accumulating volume, so momentum may continue past the target. | ||
Forward P/E of 18.4x with a PEG of 2.10 means the valuation is not supported by growth. Valuation breakdown | Earnings growth accelerates so PEG falls below 1.5. | ↓Deteriorating |
| CounterDefensive security products may deserve a premium multiple. | ||
RSI of 93 signals an extremely overbought stock that has run far above typical levels. Momentum breakdown | RSI normalizes below 70 without a price drop of more than 10%. | ↑Improving |
| CounterStrong volume accumulation suggests buyers may keep the trend going. | ||
Return on equity of 34%, margins near 16% and a Piotroski score of 8 of 9 mark a high-quality business.
→StableQuality breakdown
- Expectation
- ROE stays above 25% over the next 12 months.
CounterReturns may be flattered by leverage rather than operating strength.
Quarterly revenue rose from about $1.03B in late 2025 to $1.17B in the September 2026 quarter.
→StableEarnings
- Expectation
- Quarterly revenue stays above $1.1B.
CounterEarnings were split with two misses and two beats, so margin pressure may offset sales growth.
The $186.44 price is above the $167.59 analyst target by about 10.1%, leaving no upside to target.
↓DeterioratingTargets
- Expectation
- Price consolidates toward the target or targets rise.
CounterThe stock is 1.7% from its 52-week high with accumulating volume, so momentum may continue past the target.
Forward P/E of 18.4x with a PEG of 2.10 means the valuation is not supported by growth.
↓DeterioratingValuation breakdown
- Expectation
- Earnings growth accelerates so PEG falls below 1.5.
CounterDefensive security products may deserve a premium multiple.
RSI of 93 signals an extremely overbought stock that has run far above typical levels.
↑ImprovingMomentum breakdown
- Expectation
- RSI normalizes below 70 without a price drop of more than 10%.
CounterStrong volume accumulation suggests buyers may keep the trend going.
Per-dimension breakdown
Quality
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 7.5 |
| Gross margin | 5.0 |
| Op margin | 9.7 |
| Net margin | 7.9 |
| Current ratio | 6.7 |
| FCF quality | 6.2 |
| Moat | 6.1 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 34%
- ▸Strong margins: 16%
- ▸Strong Piotroski F-Score: 8/9
- ▸High-quality business
Growth
5.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.9 |
| EPS growth | 5.8 |
Momentum
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 2.9 |
- ▸Overbought (RSI 90)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.2 |
| Analyst rating | 7.0 |
| Price target | 5.3 |
Insider
5.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.9 |
- ▸Insider selling (low materiality) — $2,165,598 (0.013% of mkt cap)
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.4 |
| quality rank | 7.7 |
| growth rank | 4.5 |
- ▸Superior ROE vs peers
Technical
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.5 |
| support resistance | 0.6 |
| 52w position | 9.7 |
Risk (lower is worse)
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.4 |
| days to cover | 8.4 |
| volatility | 6.0 |
| put call | 10.0 |
| implied vol | 6.1 |
| max pain risk | 3.0 |
| beta | 8.1 |
| debt equity | 5.0 |
- ▸Above max pain $125
Catalyst
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 3.1 |
| dividend safety | 6.8 |
| news activity | 6.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:7.1>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.50
- EARNINGS_PROXIMITY:105d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.7=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.74
Upside
-11.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.8 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Quality at 7.6) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.7=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.74 — supplementary context, not the trigger for this path.
The strongest dimensions are Quality at 7.6, Momentum at 7.1, and Risk (lower is worse) at 6.9; the weakest are Technical at 3.9, Peer rank at 4.4, and Value at 4.9. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -0.74 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Return Quality
Trip ifReturn on equity falls below 25% from current 34%.
- P2Revenue Recovery
Trip ifQuarterly revenue falls below $1.05B.
- P3Price Above Analyst Target
Trip ifPrice exceeds the analyst target by more than 20%.
- P4Rich Multiple For Growth
Trip ifForward P/E rises above 22x.
- P5Overbought Technicals
Trip ifPrice falls more than 10% below the current $186.44.