Core Viewpoint - Allison Transmission has demonstrated a commitment to shareholder returns through dividend increases and share repurchases, while also positioning itself for future growth amid a challenging economic environment [1][3][19]. Financial Performance - In 2024, Allison generated an adjusted free cash flow of $658 million and repaid over $100 million of term loan debt, increasing cash and cash equivalents to $781 million from $555 million year-over-year [2]. - The company reported record revenues of $3.2 billion in 2024, with expectations for net sales in the range of $3.2-$3.3 billion for 2025, driven by strong demand in vocational vehicle markets [4]. - As of the end of 2024, long-term debt decreased to $2.39 billion from $2.49 billion in 2023 [2]. Shareholder Returns - Allison raised its first-quarter 2025 dividend by 8% to 27 cents, marking the sixth consecutive year of dividend increases, with a sustainable payout ratio of around 12% [1]. - The company authorized an additional $1 billion for share repurchases, having already bought back $250 million worth of stock in 2024, and repurchased over 63% of its outstanding shares since its IPO in 2012 [3]. Market Position and Growth Drivers - The company is well-positioned to benefit from rising global defense budgets, with sales in its Defense market increasing by 28% year-over-year to a decade-high of $212 million [5]. - Allison's focus on innovation, including fully automatic transmissions and electrification solutions, is expected to unlock new growth opportunities [6]. - International expansion efforts, particularly in Brazil and partnerships in Africa, Asia, and South America, reinforce its global growth strategy [7]. Challenges and Economic Factors - Rising R&D expenses, driven by increased spending on product initiatives, may impact short-term profitability despite supporting long-term growth [8]. - Inflationary pressures have led to higher costs for raw materials and labor, which could affect profitability if the company struggles to pass on these costs [9]. - Geopolitical risks, supply chain disruptions, and economic uncertainty pose challenges to the commercial vehicle industry, which is sensitive to economic downturns [10]. Future Estimates - The Zacks Consensus Estimate for Allison's 2025 sales and EPS indicates a year-over-year increase of 1.4% and 9%, respectively, with further growth projected for 2026 [11]. - However, EPS estimates for the first two quarters of 2025 and the full year have seen downward revisions over the past 30 days [12]. Valuation and Performance - Year-to-date, Allison shares have declined by 7%, underperforming its industry and peers [13]. - The company is currently trading at a forward sales multiple of 2.55X, which is higher than some peers but similar to others in the industry [16]. Analyst Recommendations - The average brokerage recommendation for Allison is 3 on a scale of 1 to 5, with a mix of "Hold," "Strong Buy/Buy," and "Sell/Strong Sell" ratings among analysts [20].

INDIANAPOLIS, Feb. 20, 2025 /PRNewswire/ -- Allison Transmission Holdings Inc. (NYSE: ALSN), a leading designer and manufacturer of conventional and electrified vehicle propulsion solutions and the largest global manufacturer of medium- and heavy-duty fully automatic transmissions for commercial and defense vehicles, announced today that its Board of Directors has approved an increase in the Company's quarterly dividend from $0.25 to $0.27 per share on the Company's common stock and has declared a cash divi ...

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Core Viewpoint - Allison Transmission Holdings (ALSN) has shown strong performance with a 32.1% increase in share price over the past six months, significantly outperforming its sector and the S&P 500 index, indicating strong fundamentals and growth prospects that make it a compelling buy [1][2]. Financial Performance - Allison achieved record net sales of $3.2 billion in 2024, with a 15% year-over-year revenue increase in its North America on-highway market, driven by demand for Class 8 vocational vehicles [5]. - The defense segment experienced a 28% year-over-year sales increase to $212 million, attributed to rising global defense spending due to geopolitical uncertainties [6]. - For 2025, net sales are expected to range from $3.2 billion to $3.3 billion, with net income anticipated between $735 million and $785 million, reflecting growth from the previous year [10][11]. Growth Initiatives - The company is expanding its product portfolio, including a $100 million annual revenue opportunity from its wide-mining dump truck initiative and the launch of its 6,000 series transmission for heavy-duty vehicles [7]. - The e-Gen Power portfolio is adapting to industry changes, with specific focus on the eGen Flex and eGen Force portfolios enhancing Allison's market prospects [8]. Shareholder Returns - Allison generated $658 million in adjusted free cash flow in 2024, allowing for over $100 million in debt reduction and more than $250 million in share repurchases, alongside a 67% increase in quarterly dividends over the past five years [9]. Earnings Estimates - The Zacks Consensus Estimate for ALSN's first-quarter 2025 EPS is $2.17, indicating a year-over-year growth of 14.21%, with the 2025 EPS estimate at $9.22, reflecting a 10.95% growth [12]. Conclusion - With robust financial performance, strategic growth initiatives, and positive earnings projections for 2025, Allison presents an attractive investment opportunity, currently holding a Zacks Rank 2 (Buy) [13].

Financial Performance - Net sales for the year ended December 31, 2024, were $3,225 million, an increase of 6% compared to $3,035 million in 2023[197]. - Net income for 2024 was $731 million, representing 23% of net sales, compared to $673 million, or 22% of net sales in 2023[196]. - Adjusted EBITDA for 2024 was $1,165 million, with an Adjusted EBITDA margin of 36.1%[190]. - Gross profit for the year ended December 31, 2024 was $1,529 million, an increase of 4% from $1,470 million in 2023, driven by $80 million in price increases and $62 million in increased net sales[200]. - Basic earnings per share attributable to common stockholders increased to $8.40 in 2024 from $7.48 in 2023[275]. - The company reported a comprehensive income of $711 million for 2024, compared to $664 million in 2023[275]. Sales and Revenue Breakdown - North America On-Highway net sales increased by $223 million, or 15%, driven by demand for Class 8 vocational and medium-duty trucks[197]. - Defense end market net sales rose by $46 million, or 28%, due to increased demand for Tracked vehicle applications[197]. - Global Off-Highway net sales decreased by $62 million, or 37%, primarily due to lower demand from the energy sector in North America[197]. - Revenue from North America On-Highway increased to $1,752 million in 2024, up 14.6% from $1,529 million in 2023[344]. - Defense revenue rose to $212 million in 2024, a 27.7% increase compared to $166 million in 2023[344]. Costs and Expenses - Cost of sales for 2024 was $1,696 million, an increase of 8% from $1,565 million in 2023, driven by higher direct material and manufacturing expenses[198]. - Selling, general and administrative expenses decreased by 6% to $337 million in 2024 from $357 million in 2023, primarily due to lower intangible amortization expenses[201]. - Engineering expenses increased by 3% to $200 million in 2024, up from $194 million in 2023, mainly due to increased spending on product initiatives[202]. - Net interest expense decreased by 17% to $89 million in 2024 from $107 million in 2023, attributed to higher interest income and lower interest expense due to a $101 million principal repayment[203]. Cash Flow and Investments - Cash flows from operating activities generated $801 million in 2024, an increase from $784 million in 2023, driven by higher gross profit and lower cash interest payments[218]. - Cash used for investing activities rose to $147 million in 2024 from $129 million in 2023, primarily due to increased capital expenditures[219]. - Cash used for financing activities increased to $427 million in 2024 from $332 million in 2023, mainly due to higher long-term debt payments[220]. - The company repurchased approximately $254 million of its common stock in 2024, with $519 million remaining available under the Repurchase Program[215]. Assets and Liabilities - Total assets as of December 31, 2024, were $5,336 million, compared to $5,025 million in 2023, marking a 6.2% increase[273]. - Total liabilities decreased to $3,685 million in 2024 from $3,792 million in 2023, a reduction of 2.8%[273]. - The balance of stockholders' equity at December 31, 2024, was $1.651 billion, up from $1.233 billion in 2023[281]. - As of December 31, 2024, the total long-term debt of the Company is $2,414 million, a decrease from $2,518 million in 2023[372]. Market and Economic Factors - A 10% increase or decrease in the Chinese Yuan Renminbi, Euro, Indian Rupee, and Japanese Yen would change the company's earnings by an estimated $5 million per year[252]. - Approximately 65% of the company's cost of sales consists of purchased components, with significant exposure to fluctuations in aluminum and steel prices[253]. - A 10% variation in aluminum prices would change earnings by approximately $8 million per year, while a similar variation in steel prices would change earnings by approximately $13 million per year[254]. Employee and Labor Relations - The UAW Local 933 ratified a new four-year collective bargaining agreement, leading to increased labor costs[177]. - Stock-based compensation increased to $26 million in 2024 from $22 million in 2023[281]. - Dividends on common stock were $1.00 per share in 2024, compared to $0.92 per share in 2023[281]. Company Overview - Allison Transmission Holdings, Inc. is the largest global manufacturer of medium- and heavy-duty fully automatic transmissions[283]. - The company operates a global distribution network with approximately 1,600 independent distributor and dealer locations[176]. - The company has been headquartered in Indianapolis, Indiana since its founding in 1915[283].

Allison Transmission Holdings (ALSN) delivered fourth-quarter 2024 earnings of $2.01 per share, which beat the Zacks Consensus Estimate of $1.93 and rose 5.2% year over year. Record quarterly revenues of $796 million grew 2.7% from the year-ago period's level and outpaced the Zacks Consensus Estimate of $791 million.See the Zacks Earnings Calendar to stay ahead of market-making news.Segmental PerformanceAllison segregates revenues in terms of end markets served, which are as follows:In the reported quarter, ...

Allison Transmission Holdings, Inc. (NYSE:ALSN) Q4 2024 Earnings Conference Call February 11, 2025 5:00 PM ET Corporate Participants Jacalyn Bolles - Executive Director, Treasury and Investor Relations David Graziosi - Chair and Chief Executive Officer Frederick Bohley - Chief Operating Officer, Chief Financial Officer and Treasurer Conference Call Participants Tami Zakaria - JP Morgan Tim Thein - Raymond James Kyle Menges - Citigroup Rob Wertheimer - Melius Research Ian Zaffino - Oppenheimer & Company Ang ...

Q4 2024 Earnings Release February 11th, 2025 Allison Transmission's business is subject to numerous risks and uncertainties, which may cause future results of operations to vary significantly from those presented herein. Important factors that could cause actual results to differ materially are discussed in Allison Transmission's Annual Report on Form 10-K for the year ended December 31, 2023. 2 Non-GAAP Financial Information We use Adjusted EBITDA and Adjusted EBITDA as a percent of net sales to measure ou ...

Core Insights - Allison Transmission (ALSN) reported quarterly earnings of $2.01 per share, exceeding the Zacks Consensus Estimate of $1.93 per share, and showing an increase from $1.91 per share a year ago, resulting in an earnings surprise of 4.15% [1] - The company achieved revenues of $796 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.60% and up from $775 million year-over-year [2] - The stock has gained approximately 5.6% since the beginning of the year, outperforming the S&P 500's gain of 3.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.23 on revenues of $843.14 million, and for the current fiscal year, it is $9.22 on revenues of $3.43 billion [7] - The estimate revisions trend for Allison Transmission is favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Automotive - Original Equipment industry, to which Allison Transmission belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Magna (MGA), another company in the same industry, is expected to report quarterly earnings of $1.46 per share, reflecting a year-over-year increase of 9.8%, although its consensus EPS estimate has been revised 1.5% lower recently [9]

Exhibit 99.1 Allison Transmission Announces Record Fourth Quarter and Full Year 2024 Results * Record fourth quarter net sales of $796 million, leading to all-time high full year net sales of $3.2 billion * Record full year diluted EPS of $8.31, up 12% year over year INDIANAPOLIS, February 11, 2025 – Allison Transmission Holdings Inc. (NYSE: ALSN) today reported all-time high full year net sales of $3.2 billion, increasing 6 percent from 2023. Diluted EPS for the year increased 12 percent year over year to ...