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Core Insights - Investors are optimistic about Nvidia's upcoming Q4 results, while several other Zacks-rated stocks have exceeded EPS expectations, indicating strong growth trajectories and potential for portfolio diversification [1] Group 1: Allison Transmission Holdings (ALSN) - Allison Transmission Holdings reported Q4 EPS of $1.70, surpassing expectations of $1.56 by 9%, although it decreased from $2.01 per share a year ago [2] - The full-year EPS for FY25 was slightly down to $8.21, but it is projected to rebound with an 18% increase to $9.68 this year [2] - ALSN trades at an attractive 12X forward earnings multiple and offers a respectable annual dividend yield nearing 1% [3] Group 2: BWX Technologies (BWXT) - BWX Technologies achieved Q4 EPS of $1.08, beating estimates of $0.91 by nearly 19% and increasing from $0.92 per share in the same quarter last year [4] - The full-year EPS rose 20% to $4.01, with annual earnings expected to increase another 6% in FY26 [6] - BWXT has a forward P/E multiple of 46X, reflecting high investor sentiment in the aerospace and defense sector amid geopolitical tensions [5] Group 3: Telefonica Brasil (VIV) - Telefonica Brasil reported Q4 EPS of $0.22, exceeding expectations of $0.17 and up from $0.18 per share last year [9] - As the largest wireless provider in Brazil, it offers a 2.49% annual dividend yield, with annual earnings up 8% and FY26 EPS forecasted to spike 26% to $0.86 [10] Group 4: V2X Inc (VVX) - V2X Inc posted Q4 EPS of $1.56, beating estimates of $1.33 by 17% and showing a 21% increase in FY25 EPS to $5.24 [11] - The company does not offer a dividend but trades at a relatively low 12X forward earnings multiple, indicating improving growth prospects [12]

Key Takeaways ALSN beat Q4 EPS and revenue estimates, though earnings fell 15.4% and sales dropped 7.4% year over year.North America On-Highway sales declined on softer truck demand, while Europe lifted overseas results.Allison Transmission issued 2026 sales of $3.03-$3.18B and EBITDA outlook above 2025 levels.Allison Transmission Holdings (ALSN) reported fourth-quarter 2025 earnings of $1.70 per share, which beat the Zacks Consensus Estimate of $1.56 but declined 15.4% year over year. Quarterly revenues of ...

Financial Performance - In 2025, total net sales decreased by 7% to $3,010 million compared to $3,225 million in 2024[209] - North America On-Highway net sales fell by 12% to $1,540 million in 2025, primarily due to lower demand for medium-duty and class 8 vocational trucks[209] - Defense end market net sales increased by 26% to $267 million in 2025, driven by higher demand for tracked vehicle applications[212] - Adjusted EBITDA for 2025 was $1,130 million, representing 37.5% of net sales, compared to 36.1% in 2024[221] - Gross profit for 2025 was $1,463 million, down 4% from $1,529 million in 2024, with gross profit as a percentage of net sales increasing by 120 basis points[226] - Operating income for 2025 was $880 million, representing 29% of net sales, compared to $992 million or 31% in 2024[223] - Net income for 2025 was $623 million, accounting for 21% of net sales, compared to $731 million or 23% in 2024[223] - Adjusted free cash flow for 2025 was $661 million, slightly up from $658 million in 2024[221] Cash Flow and Liquidity - The company generated $836 million in net cash provided by operating activities for the year ended December 31, 2025[221] - Total available cash and cash equivalents increased to $1,495 million in 2025 from $781 million in 2024[233] - Cash flows from operating activities for the year ended December 31, 2025, were $836 million, an increase of 4.4% from $801 million in 2024[250] - Cash used for investing activities increased to $184 million in 2025 from $147 million in 2024, primarily due to a $32 million rise in capital expenditures[251] - Financing activities provided $57 million in cash in 2025, a significant recovery from a cash usage of $427 million in 2024, driven by $500 million from the issuance of Senior Notes[252] - As of December 31, 2025, the company had $1,495 million in cash and cash equivalents and $745 million available under the Revolving Credit Facility[1] Expenses and Costs - The cost of sales for 2025 consisted of approximately 66% direct material costs, 26% overhead costs, and 8% direct labor costs[215] - Selling, general and administrative expenses increased by 13% to $380 million in 2025, driven by $64 million related to the Acquisition[227] - Engineering expenses decreased by 13% to $174 million in 2025, reflecting reduced spending on product initiatives[228] - Interest expense for 2025 was $92 million, an increase of 3% from $89 million in 2024[230] Debt and Financing - As of December 31, 2025, total indebtedness included $509 million from ATI's Term Loan and $1,000 million from 3.75% Senior Notes due January 2031[236] - The company authorized an additional $1,000 million for its stock repurchase program, totaling $5,000 million, with $328 million repurchased in 2025[246] - The company made $5 million and $104 million of principal payments on the Term Loan during the years ended December 31, 2025 and 2024, respectively[239] - On January 2, 2026, the company entered into an amendment to increase the Revolving Credit Facility commitments by $250 million to a total of $1,000 million[241] - The company had no amounts outstanding under the Revolving Credit Facility as of December 31, 2025[240] Impairment and Valuation - An impairment analysis in Q4 2025 resulted in an $8 million loss for tangible assets and a $21 million loss for intangible assets due to deteriorating market conditions[268] - The company performed a quantitative impairment analysis of goodwill in 2025, indicating no impairment as the fair value exceeded carrying value[262] - The company recorded $29 million in losses associated with the impairment of long-lived assets in 2025[229] - The company evaluates the carrying value of long-lived assets whenever events indicate that the carrying value may not be recoverable, with impairment recognized when future cash flows are less than carrying value[266] - The company utilizes a market approach for impairment analysis, reflecting the complexity of determining fair values[268] Future Outlook and Assumptions - The company believes that cash provided by operating activities and available liquidity will meet cash requirements for the next twelve months[248] - The company anticipates increased capital expenditures and cash income taxes in 2026 compared to 2025[245] - A 10% change in sales incentives could impact earnings by approximately $8 million, highlighting the sensitivity of revenue recognition estimates[254] - Assumptions and estimates regarding future cash flows and market conditions are complex and subjective, potentially impacting reported financial results[267] Other Considerations - Provisions for estimated warranty expenses are made at the time of product sale, with adjustments based on historical claims and repair costs[269] - The company assesses the need for a valuation allowance against deferred tax assets quarterly, considering various factors including recent losses and forecasts of future profitability[274] - A one percentage point decrease in the assumed discount rate would increase the defined benefit pension plans obligation by approximately $13 million and the OPEB obligation by approximately $6 million as of December 31, 2025[271][272] - The acquisition method is used for business combinations, with assets and liabilities recorded at estimated fair value at acquisition date, and excess purchase price recorded as goodwill[276] - The company reviews the useful lives of intangible assets periodically to determine if revisions are warranted based on events or circumstances[264] - Warranty costs may differ from estimates if actual claim rates are higher or lower than historical rates[269]

Core Viewpoint - Allison Transmission reported quarterly earnings of $1.7 per share, exceeding the Zacks Consensus Estimate of $1.56 per share, but down from $2.01 per share a year ago, indicating an earnings surprise of +8.97% [1] Financial Performance - The company achieved revenues of $737 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 2.01%, although this is a decrease from year-ago revenues of $796 million [2] - Over the last four quarters, Allison Transmission has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Performance - Allison Transmission shares have increased approximately 21.4% since the beginning of the year, significantly outperforming the S&P 500's gain of 0.9% [3] Future Outlook - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $2.38 for the coming quarter and $9.68 for the current fiscal year, alongside projected revenues of $1.35 billion and $5.67 billion respectively [7] - The Zacks Rank for Allison Transmission is currently 2 (Buy), indicating expectations for the stock to outperform the market in the near future [6] Industry Context - The Automotive - Original Equipment industry, to which Allison Transmission belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8]

Allison Transmission (NYSE:ALSN) Q4 2025 Earnings call February 23, 2026 05:00 PM ET Company ParticipantsAngel Castillo - Executive DirectorCraig Price - President and Business Unit Leader of Off-Highway Drive & Motion SystemsDave Graziosi - Chair, President, and CEOFred Bohley - COO and Transmission Business Unit LeaderJackie Bolles - Executive Director of Treasury and Investor RelationsJerry Revich - Managing DirectorScott Mell - CFO and TreasurerTami Zakaria - Executive DirectorConference Call Participan ...

Allison Transmission (NYSE:ALSN) Q4 2025 Earnings call February 23, 2026 05:00 PM ET Company ParticipantsAngel Castillo - Executive DirectorCraig Price - President and Business Unit Leader of Off-Highway Drive & Motion SystemsDave Graziosi - Chair, President, and CEOFred Bohley - COO and Transmission Business Unit LeaderJackie Bolles - Executive Director of Treasury and Investor RelationsJerry Revich - Managing DirectorScott Mell - CFO and TreasurerTami Zakaria - Executive DirectorConference Call Participan ...

Allison Transmission (NYSE:ALSN) Q4 2025 Earnings call February 23, 2026 05:00 PM ET Speaker9Good afternoon. Thank you for standing by. Welcome to Allison's fourth quarter 2025 earnings conference call. My name is Paul, I will be your conference call operator today. At this time, all participants are in a listen-only mode. After prepared remarks, Allison executives will conduct a question-and-answer session, conference call participants will be given instructions at that time. As a reminder, this conference ...

Q4 2025 Earnings Release February 23rd, 2026 Dave Graziosi – Chair, President & CEO Scott Mell – CFO & Treasurer Fred Bohley – Allison Transmission President & COO Craig Price – Allison Off-Highway President 1 Safe Harbor Statement The following information contains forward-looking statements. The words "believe," "expect," "anticipate," "intend," "estimate" and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-lookin ...

Exhibit 99.1 News Release Allison Transmission Announces Fourth Quarter and Full Year 2025 Results INDIANAPOLIS, February 23, 2026 – Allison Transmission Holdings Inc. (NYSE: ALSN) today reported full year 2025 net sales of $3 billion with Adjusted EBITDA margin of 37.5 percent and net cash provided by operating activities of $836 million. David S. Graziosi, Chair, President and Chief Executive Officer of Allison commented, "Although 2025 presented meaningful macroeconomic challenges, we remained discipline ...