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    ALLE · NYQ · Industrials

    Allegion plc

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 144.63

    Market price

    USD 191.73

    Implied upside

    -24.6%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 144.63-24.6%
    Exit multiple
    USD 196.91+2.7%
    Market price
    USD 191.73

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0m469m939mFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 4.5bnUSD 4.7bnUSD 5.0bnUSD 5.3bnUSD 5.5bnUSD 5.7bnUSD 6.0bnUSD 6.2bnUSD 6.3bnUSD 6.5bn+4.2%
    EBITUSD 888.5mUSD 941.6mUSD 993.7mUSD 1.0bnUSD 1.1bnUSD 1.1bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bn+4.2%
    NOPATUSD 769.0mUSD 814.9mUSD 860.1mUSD 904.0mUSD 946.2mUSD 986.3mUSD 1.0bnUSD 1.1bnUSD 1.1bnUSD 1.1bn+4.2%
    Add depreciation & amortisationUSD 139.7mUSD 148.1mUSD 156.3mUSD 164.2mUSD 171.9mUSD 179.2mUSD 186.0mUSD 192.3mUSD 197.9mUSD 202.9m+4.2%
    Less capital expenditureUSD -102.1mUSD -124.8mUSD -149.4mUSD -175.5mUSD -203.1mUSD -231.8mUSD -261.6mUSD -292.1mUSD -323.0mUSD -353.9m+14.8%
    Capex, % of revenue2.3%2.6%3.0%3.3%3.7%4.0%4.4%4.7%5.1%5.4%-
    Less increase in working capitalUSD -69.3mUSD -45.1mUSD -44.3mUSD -43.1mUSD -41.5mUSD -39.4mUSD -36.8mUSD -33.9mUSD -30.5mUSD -26.7m-10.0%
    Free cashflow to firmUSD 737.3mUSD 793.0mUSD 822.6mUSD 849.6mUSD 873.6mUSD 894.3mUSD 911.4mUSD 924.6mUSD 933.8mUSD 938.8m+2.7%
    Discount factor0.96140.88870.82140.75920.70180.64870.59960.55420.51230.4735-
    Present valueUSD 708.9mUSD 704.7mUSD 675.7mUSD 645.1mUSD 613.1mUSD 580.1mUSD 546.4mUSD 512.4mUSD 478.4mUSD 444.5m-
    Present Value Of The ForecastUSD 5.9bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.882Reported 0.824, pulled toward 1.0 (Blume)
    Cost of equity8.63%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 8.5x interest cover. Book interest / average debt was lower, at 5.1%.
    Market capitalisationUSD 16.3bn89.2% of capital
    Total debtUSD 2.0bn10.8% of capital, book value as a proxy
    Tax rate13.5%Effective, capped at statutory
    WACC8.19%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 144.63

    58% of EV

    Forecast FCFF, final year
    USD 938.8m
    Capex at depreciation, working capital in reinvestment
    USD 1.1bn
    Less reinvestment at g/ROIC (13.5% of NOPAT)
    USD -151.0m
    Capitalised
    USD 965.5m
    ROIC (reported)
    18.5%
    Terminal value, undiscounted
    USD 17.4bn
    Terminal value, discounted
    USD 8.2bn
    Enterprise value
    USD 14.1bn
    Less net debt
    USD 1.6bn
    Equity value
    USD 12.5bn

    Exit at 18.1x EBITDA

    Value per shareUSD 196.91

    68% of EV

    Terminal value, undiscounted
    USD 27.0bn
    Terminal value, discounted
    USD 12.8bn
    Enterprise value
    USD 18.7bn
    Less net debt
    USD 1.6bn
    Equity value
    USD 17.1bn

    Spread between methods: 31%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.19%202.82215.07230.88251.92281.11
    7.19%163.81170.40178.56188.87202.20
    8.19%136.51140.18144.63150.09156.89
    9.19%116.33118.38120.85123.82127.46
    10.19%100.83101.92103.24104.84106.79

    Outlined: this model. Green text: above today's price of 191.73. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year7.5%4.8%8.0%
    EBIT margin21.1%19.8%25.5%
    Discount rate-8.2%6.9%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.