Allison Transmission Q4 Earnings Analysis
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 9 hours ago
0mins
Should l Buy ALSN?
Source: seekingalpha
- Earnings Performance: Allison Transmission reported a Q4 GAAP EPS of $1.18, missing expectations by $0.32, indicating pressure on profitability that may affect investor confidence.
- Revenue Trends: The company's Q4 revenue was $737 million, down 7.4% year-over-year, although it beat market expectations by $17.86 million, the ongoing decline could impact future growth outlook.
- Defense Market Strength: The defense segment achieved full-year net sales of $267 million, a 26% year-over-year increase, demonstrating enhanced competitiveness in this area, which may help offset weaknesses in other markets.
- Acquisition Progress: Allison completed the acquisition of Dana's Off-Highway business on January 1, 2026, aiming to create a global leader in high-performance mobility and work solutions, which is expected to enhance market share and technological capabilities.
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Analyst Views on ALSN
Wall Street analysts forecast ALSN stock price to fall
5 Analyst Rating
1 Buy
4 Hold
0 Sell
Hold
Current: 118.850
Low
98.00
Averages
109.40
High
115.00
Current: 118.850
Low
98.00
Averages
109.40
High
115.00
About ALSN
Allison Transmission Holdings, Inc. is a designer and manufacturer of propulsion solutions for commercial and defense vehicles. The Company is also a manufacturer of medium-and heavy-duty fully automatic transmissions. Its products are used in a variety of applications, including on-highway trucks, including distribution, refuse, construction, fire and emergency; buses, including school, transit and coach; motorhomes, off-highway vehicles, and equipment, including energy, mining and construction applications; and defense vehicles, including tactical wheeled and tracked. The Company operates in approximately 150 countries. The Company has manufacturing facilities in the United States, Hungary and India, as well as global engineering resources, including electrification engineering centers in Indianapolis, Indiana, Auburn Hills, Michigan and London in the United Kingdom. The Company also has approximately 1,600 independent distributor and dealer locations worldwide.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Allison Transmission Q4 2025 Earnings Call Insights
- Acquisition Completed: Allison Transmission has finalized its acquisition of Dana's Off-Highway Drive & Motion Systems, increasing its workforce to 14,000 across 25 countries, which is expected to significantly enhance market reach and product portfolio, thereby driving future financial performance.
- Financial Performance: Q4 2025 net sales were $737 million, down 7% year-over-year, yet adjusted EBITDA margin rose by 140 basis points to 37.5%, demonstrating the company's resilience in a challenging market, particularly with defense revenue increasing by 26% to $267 million.
- Future Outlook: The company projects 2026 consolidated net sales between $5.575 billion and $5.925 billion, with adjusted EBITDA expected to range from $1.365 billion to $1.515 billion, as management expresses confidence in achieving annual run rate synergies despite ongoing softness in the North American market.
- Shareholder Returns: In 2025, Allison repurchased $328 million in stock and raised its quarterly dividend to $0.27 per share, reflecting the company's commitment to returning capital to shareholders while maintaining strong cash flow and enhancing investor confidence.
See More
Allison Transmission (ALSN) Earnings Transcript
See More
Allison Transmission Q4 Earnings Analysis
- Earnings Performance: Allison Transmission reported a Q4 GAAP EPS of $1.18, missing expectations by $0.32, indicating pressure on profitability that may affect investor confidence.
- Revenue Trends: The company's Q4 revenue was $737 million, down 7.4% year-over-year, although it beat market expectations by $17.86 million, the ongoing decline could impact future growth outlook.
- Defense Market Strength: The defense segment achieved full-year net sales of $267 million, a 26% year-over-year increase, demonstrating enhanced competitiveness in this area, which may help offset weaknesses in other markets.
- Acquisition Progress: Allison completed the acquisition of Dana's Off-Highway business on January 1, 2026, aiming to create a global leader in high-performance mobility and work solutions, which is expected to enhance market share and technological capabilities.
See More
Allison Transmission Set to Report Q4 Earnings
- Earnings Announcement Date: Allison Transmission Holdings (ALSN) is set to release its Q4 earnings on February 23rd after market close, with consensus EPS estimate at $1.46, reflecting a 27.4% year-over-year decline, and revenue estimate at $719.14 million, down 9.7% year-over-year.
- Historical Performance: Over the past year, Allison has consistently beaten EPS and revenue estimates 100% of the time, indicating strong business performance and market adaptability, although it currently faces downward pressure on earnings expectations.
- Estimate Revisions: In the last three months, EPS estimates have seen no upward revisions and one downward revision, while revenue estimates experienced four upward revisions and one downward revision, highlighting market divergence and uncertainty regarding the company's future performance.
- Market Analysis Perspective: Despite Allison's strong business performance, market analysts suggest that it may not be an ideal buying opportunity at this time, urging investors to carefully assess the relationship between its future growth potential and current valuation.
See More
Allison Transmission to Announce 2025 Financial Results
- Conference Call Schedule: Allison Transmission will hold its fourth quarter and full year 2025 financial results conference call on February 23, 2026, at 5:00 p.m. EST, where executives will review the company's financial performance, which is expected to impact investor confidence positively.
- Market Announcement Timing: The financial results will be released post-market on February 23, 2026, ensuring that investors receive the latest financial information before the call, thereby enhancing transparency and market responsiveness.
- Participation Details: Investors can join the call by dialing +1-877-425-9470 (domestic) or +1-201-389-0878 (international), providing multiple participation options to cater to diverse investor needs and enhancing communication between the company and its investors.
- Replay Information: For those unable to attend live, a replay will be available from 9:00 p.m. EST on February 23 until 11:59 p.m. EST on March 9, with the replay dial-in number being +1-844-512-2921, ensuring all investors can access the meeting content and further improving information accessibility.
See More
Eaton Shares Climb Following Spin-Off Announcement; Company Expands into Aviation and AI Data Centers.
- Strategic Business Decisions: Companies can enhance their growth and profitability by divesting slower-growing segments.
- Focus on Core Operations: Spinning off less profitable businesses allows firms to concentrate on higher-margin opportunities.
- Market Reactions: Such strategic moves can lead to positive market perceptions and increased investor confidence.
- Long-term Benefits: Ultimately, these decisions can position companies for sustained success and competitive advantage.
See More
Allison Transmission Q4 2025 Earnings Call Insights
- Acquisition Completed: Allison Transmission has finalized its acquisition of Dana's Off-Highway Drive & Motion Systems, increasing its workforce to 14,000 across 25 countries, which is expected to significantly enhance market reach and product portfolio, thereby driving future financial performance.
- Financial Performance: Q4 2025 net sales were $737 million, down 7% year-over-year, yet adjusted EBITDA margin rose by 140 basis points to 37.5%, demonstrating the company's resilience in a challenging market, particularly with defense revenue increasing by 26% to $267 million.
- Future Outlook: The company projects 2026 consolidated net sales between $5.575 billion and $5.925 billion, with adjusted EBITDA expected to range from $1.365 billion to $1.515 billion, as management expresses confidence in achieving annual run rate synergies despite ongoing softness in the North American market.
- Shareholder Returns: In 2025, Allison repurchased $328 million in stock and raised its quarterly dividend to $0.27 per share, reflecting the company's commitment to returning capital to shareholders while maintaining strong cash flow and enhancing investor confidence.
See More
Allison Transmission (ALSN) Earnings Transcript
See More
Allison Transmission Q4 Earnings Analysis
- Earnings Performance: Allison Transmission reported a Q4 GAAP EPS of $1.18, missing expectations by $0.32, indicating pressure on profitability that may affect investor confidence.
- Revenue Trends: The company's Q4 revenue was $737 million, down 7.4% year-over-year, although it beat market expectations by $17.86 million, the ongoing decline could impact future growth outlook.
- Defense Market Strength: The defense segment achieved full-year net sales of $267 million, a 26% year-over-year increase, demonstrating enhanced competitiveness in this area, which may help offset weaknesses in other markets.
- Acquisition Progress: Allison completed the acquisition of Dana's Off-Highway business on January 1, 2026, aiming to create a global leader in high-performance mobility and work solutions, which is expected to enhance market share and technological capabilities.
See More
Allison Transmission Set to Report Q4 Earnings
- Earnings Announcement Date: Allison Transmission Holdings (ALSN) is set to release its Q4 earnings on February 23rd after market close, with consensus EPS estimate at $1.46, reflecting a 27.4% year-over-year decline, and revenue estimate at $719.14 million, down 9.7% year-over-year.
- Historical Performance: Over the past year, Allison has consistently beaten EPS and revenue estimates 100% of the time, indicating strong business performance and market adaptability, although it currently faces downward pressure on earnings expectations.
- Estimate Revisions: In the last three months, EPS estimates have seen no upward revisions and one downward revision, while revenue estimates experienced four upward revisions and one downward revision, highlighting market divergence and uncertainty regarding the company's future performance.
- Market Analysis Perspective: Despite Allison's strong business performance, market analysts suggest that it may not be an ideal buying opportunity at this time, urging investors to carefully assess the relationship between its future growth potential and current valuation.
See More
Allison Transmission to Announce 2025 Financial Results
- Conference Call Schedule: Allison Transmission will hold its fourth quarter and full year 2025 financial results conference call on February 23, 2026, at 5:00 p.m. EST, where executives will review the company's financial performance, which is expected to impact investor confidence positively.
- Market Announcement Timing: The financial results will be released post-market on February 23, 2026, ensuring that investors receive the latest financial information before the call, thereby enhancing transparency and market responsiveness.
- Participation Details: Investors can join the call by dialing +1-877-425-9470 (domestic) or +1-201-389-0878 (international), providing multiple participation options to cater to diverse investor needs and enhancing communication between the company and its investors.
- Replay Information: For those unable to attend live, a replay will be available from 9:00 p.m. EST on February 23 until 11:59 p.m. EST on March 9, with the replay dial-in number being +1-844-512-2921, ensuring all investors can access the meeting content and further improving information accessibility.
See More
Eaton Shares Climb Following Spin-Off Announcement; Company Expands into Aviation and AI Data Centers.
- Strategic Business Decisions: Companies can enhance their growth and profitability by divesting slower-growing segments.
- Focus on Core Operations: Spinning off less profitable businesses allows firms to concentrate on higher-margin opportunities.
- Market Reactions: Such strategic moves can lead to positive market perceptions and increased investor confidence.
- Long-term Benefits: Ultimately, these decisions can position companies for sustained success and competitive advantage.
See More
