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Allison Transmission Holdings Inc ALSN

Morningstar Rating
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Stock XNYS Rating as of
$80.07 +2.60 (3.36%)
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As of Delayed Price Post-Trading: $80.57 +0.50
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Company Report

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We See Allison Remaining the Fully Automatic Transmission Leader for Trucks

David Whiston

We believe Allison will continue to be the top supplier of fully automatic truck transmissions, despite increasing regulation of emissions by government authorities. The company dominates the medium-duty market, commanding approximately 80% share in some verticals (school buses, Class 6-7 trucks, and Class 8 straight trucks). Allison's strong brand is underpinned by its high-performing and extremely durable transmissions. This has led to the company benefiting from pricing power.

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Price vs Fair Value

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ALSN is trading at a 240% premium.
Price
$77.47
Fair Value
$15.00
Uncertainty
Medium
1-Star Price
$974.31
5-Star Price
$97.50
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Allison leverages its strong brand to penetrate emerging markets with its fully automatic transmissions, substantially boosting sales.

Bears

Local competitors may prove to be stronger than expected, leaving Allison with limited market share opportunities abroad.

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News

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Trading Information

Previous Close Price
$77.47
Day Range
$77.39–80.49
52-Week Range
$50.14–83.42
Bid/Ask
$79.69 / $80.69
Market Cap
$7.00 Bil
Volume/Avg
522,312 / 592,650

Key Statistics

Price/Earnings (Normalized)
10.03
Price/Sales
2.27
Dividend Yield (Trailing)
1.24%
Dividend Yield (Forward)
1.29%
Total Yield
5.30%

Company Profile

Allison Transmission is the largest manufacturer of fully automatic transmissions for commercial vehicles. The company’s automatic transmissions allow customers to achieve better fuel and operator efficiency than less expensive manual and automated manual transmissions. Allison serves several end markets, including on- and off-highway equipment and military vehicles. Its on-highway business has about 60% global market share. The company’s transmissions can be found in Class 4-8 trucks, buses, and a limited number of large passenger vehicles (heavy-duty pickup trucks and motor homes). Allison also produces electric hybrid propulsion systems and is developing e-powertrains.
Sector
Consumer Cyclical
Industry
Auto Parts
Stock Style Box
Small Core
Total Number of Employees
3,700
Website
https://www.allisontransmission.com

Competitors

Valuation

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Metric
ALSN
CMI
PCAR
Price/Earnings (Normalized)
 10.0314.8910.70
Price/Book Value
 5.054.303.20
Price/Sales
 2.271.191.53
Price/Cash Flow
 8.2527.009.32
Price/Earnings
ALSN
CMI
PCAR

Financial Strength

Metric
ALSN
CMI
PCAR
Quick Ratio
 1.820.732.44
Current Ratio
 2.511.342.73
Interest Coverage
 8.887.93—
Quick Ratio
ALSN
CMI
PCAR

Profitability

Metric
ALSN
CMI
PCAR
Return on Assets (Normalized)
 14.14%3.38%13.26%
Return on Equity (Normalized)
 60.30%11.08%32.56%
Return on Invested Capital (Normalized)
 21.52%6.47%17.41%
Return on Assets
ALSN
CMI
PCAR
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