Contrasting ADT (ADT) and Allegion (ALLE)

ADT (NYSE: ADT) and Allegion (NYSE:ALLE) are both mid-cap industrial products companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, dividends, valuation, analyst recommendations, institutional ownership, risk and profitability.

Earnings & Valuation

This table compares ADT and Allegion’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ADT $2.95 billion 3.03 -$536.58 million N/A N/A
Allegion $2.24 billion 3.40 $229.10 million $3.52 22.72

Allegion has lower revenue, but higher earnings than ADT.

Insider and Institutional Ownership

89.8% of Allegion shares are held by institutional investors. 0.6% of Allegion shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Allegion pays an annual dividend of $0.64 per share and has a dividend yield of 0.8%. ADT does not pay a dividend. Allegion pays out 18.2% of its earnings in the form of a dividend. ADT has raised its dividend for 5 consecutive years and Allegion has raised its dividend for 2 consecutive years.

Analyst Recommendations

This is a breakdown of current recommendations for ADT and Allegion, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ADT 0 1 7 0 2.88
Allegion 0 1 4 0 2.80

ADT currently has a consensus price target of $16.25, suggesting a potential upside of 36.10%. Allegion has a consensus price target of $89.75, suggesting a potential upside of 12.23%. Given ADT’s stronger consensus rating and higher possible upside, research analysts clearly believe ADT is more favorable than Allegion.

Profitability

This table compares ADT and Allegion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ADT N/A N/A N/A
Allegion 14.37% 154.50% 15.31%

Summary

Allegion beats ADT on 8 of the 14 factors compared between the two stocks.

About ADT

ADT Inc. is a provider of monitored security, interactive home and business automation and related monitoring services in the United States and Canada. The Company offers a range of products home security systems, home automation, security cameras, fire, home and safety, and monitoring services. It also offers residential, commercial, and multi-site customers a comprehensive set of burglary, video, access control, fire and smoke alarm, and medical alert solutions. Its 24/7 monitoring capabilities are enabled by 12 monitoring centers.

About Allegion

Allegion Public Limited Company is a provider of security products and solutions. The Company offers a portfolio of mechanical and electronic security products across a range of brands. Its segments include Americas; Europe, Middle East, India and Africa (EMEIA), and Asia Pacific. Its products include door closers and controls; door and door frames (steel); electronic security products; electronic and biometric access control systems; exit devices; locks, locksets, portable locks and key systems; time, attendance and workforce productivity systems, and other accessories. It sells a range of security products and solutions for end users in commercial, institutional and residential facilities across the world, including into the education, healthcare, government, hospitality, commercial office and single and multi-family residential markets. As of December 31, 2016, it manufactured and sold mechanical and electronic security products and solutions in approximately 130 countries.

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