ALSN.N Surges as Stock Crosses Above 5-Day SMA
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 20 2024
0mins
Should l Buy ALSN?
Source: NASDAQ.COM
Shares of Allison Transmission Holdings Inc (ALSN.N) experienced a modest increase today, rising approximately 0.5% amid positive market sentiment. The stock crossed above its 5-day simple moving average (SMA), indicating a potential bullish trend as investors react favorably to the recent announcement regarding Dana Incorporated's sale of its Off-Highway business to Allison. This strategic acquisition, expected to close by year-end, is part of Dana's broader transformation strategy aimed at returning $600 million to shareholders and significantly reducing debt. Both companies' leadership expressed optimism about the integration, which aligns with their long-term growth objectives and innovation focus.
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Analyst Views on ALSN
Wall Street analysts forecast ALSN stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for ALSN is 94.40 USD with a low forecast of 80.00 USD and a high forecast of 115.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
1 Buy
3 Hold
1 Sell
Hold
Current: 113.750
Low
80.00
Averages
94.40
High
115.00
Current: 113.750
Low
80.00
Averages
94.40
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.
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- Leadership Restructuring: The new company will be headquartered in Indianapolis and led by current CEO David Graziosi, ensuring efficient management during the integration process and enhancing market responsiveness to better serve customers.
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- Debt Reduction: The transaction enables Dana to reduce approximately $2 billion in debt, achieving a target net leverage of 1x, thereby enhancing financial stability and improving margins.
- Shareholder Returns: Dana plans to return $1 billion to shareholders by 2027, with about $650 million already returned since the announcement, reflecting the company's commitment to shareholder value enhancement.
- Focus on Core Business: This divestiture allows Dana to concentrate more on the light and commercial vehicle markets with both traditional and electrified systems, reducing complexity and accelerating innovation to enhance competitive positioning.
See More
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- Financial Optimization: This transaction will enable Dana to reduce debt by approximately $2 billion, achieving a target net leverage of 1x, thereby enhancing financial stability and improving margins to support future innovation and growth.
- Shareholder Return Plan: Dana plans to return $1 billion to shareholders by 2027, with approximately $650 million already returned since the announcement, reflecting an increase of $50 million compared to the prior target, demonstrating the company's commitment to shareholder value.
- Strategic Focus: By divesting this segment, Dana can concentrate more on serving light- and commercial-vehicle customers with both traditional and electrified systems, reducing complexity and enhancing competitiveness in core markets, thereby driving further growth.
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