Allegion acquires Next Door Company to enhance portfolio

DUBLIN - Allegion plc (NYSE: NYSE:ALLE), a global provider of security products and solutions with a market capitalization of $11.2 billion and strong financial health according to InvestingPro analysis, has expanded its business by acquiring Miami-based Next (LON:NXT) Door Company, a manufacturer known for its custom stainless steel and hollow metal doors. This acquisition, the details of which were not disclosed, aims to strengthen Allegion’s position in the market by broadening its product offerings and leveraging its manufacturing and distribution capabilities across the United States.

Next Door, established in 1993, is recognized for its specialization in doors for industrial, commercial, and institutional buildings. The integration of Next Door into Allegion’s Americas segment is expected to complement the company’s existing portfolio of hollow metal doors and frames and enhance its specialty product lines. Allegion has demonstrated solid financial performance, maintaining a healthy gross profit margin of 44% and generating $584 million in free cash flow over the last twelve months.

Dave Ilardi, Senior Vice President of Allegion Americas, expressed enthusiasm about the acquisition, highlighting Next Door’s decade-long partnership with Allegion and their shared expertise in complex environments. According to Ilardi, the addition of Next Door’s custom doors and frames will not only expand Allegion’s portfolio but also benefit from the company’s specification capabilities and scale in manufacturing and distribution.

Justin Schechter, the owner of Next Door, will join Allegion to ensure a smooth transition and to support the combined businesses’ accelerated growth. Schechter emphasized Next Door’s strong industry reputation for high-quality solutions and customer satisfaction, expressing confidence that the shared passion for excellence with Allegion will serve as a foundation for further growth through shared resources and expertise.

Allegion, with $3.7 billion in revenue in 2023, is known for its focus on security around doors and adjacent areas, offering solutions for homes, businesses, schools, and institutions. The company’s security products are sold globally under leading brands such as CISA®, Interflex®, LCN®, Schlage®, SimonsVoss®, and Von Duprin®. InvestingPro data reveals that Allegion has maintained dividend payments for 11 consecutive years, with a current dividend yield of 1.49%. For deeper insights into Allegion’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.

The acquisition’s strategic and financial benefits are anticipated to align with Allegion’s growth strategy, although the company cautions that forward-looking statements involve risks and uncertainties. Allegion’s commitment to integrating Next Door’s business operations is part of its ongoing efforts to provide comprehensive security solutions and enhance its market position. According to InvestingPro analysis, three analysts have recently revised their earnings estimates upward for the upcoming period, with the company expected to report its next earnings on February 25, 2025. The stock’s current valuation suggests it may be slightly undervalued based on InvestingPro’s Fair Value calculations.

This news is based on a press release statement from Allegion plc.

In other recent news, Allegion, a leading provider of security and access control solutions, has seen significant developments. The company recently appointed Gregg Sengstack to its Board of Directors, expanding the board to nine members. Sengstack, the executive chairperson of Franklin Electric (NASDAQ:FELE) Company, Inc., brings a wealth of experience in international markets and financial management to Allegion.

Furthermore, Allegion reported robust financial results for the third quarter of 2024, with revenue reaching $967.1 million, marking a 5.4% increase from the previous year. Adjusted earnings per share rose by 11.3% to $2.16. In addition, the company completed strategic acquisitions, including SOSS Door Hardware, as part of its growth strategy.

However, Morgan Stanley (NYSE:MS) has initiated coverage on Allegion stock, assigning an Equalweight rating and establishing a price target of $137.00. The firm’s analysis indicates potential challenges ahead for Allegion due to its positioning in the industrial market. Despite these potential challenges, Baird maintained a neutral rating for Allegion but increased the stock price target to $152.00 from $145.00 after evaluating the company’s financial segments and capital management strategies. These are the recent developments in Allegion’s business operations.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.