olivLaw · US equity research
Allison Transmission Holdings Inc. ALSN
Motor Vehicle Parts & Accessories · SIC 3714 · Vertical: Motor Vehicle Parts & Accessories (SIC 3714)
Allison Transmission is the world's largest maker of fully automatic transmissions for medium- and heavy-duty commercial vehicles and a key supplier for U.S. defense vehicles. Since January 1, 2026 it has integrated the off-highway business bought from Dana, which broadened its revenue base after annual net sales of 3010 million USD in 2025.
The AI analysis may be outdated: new filings came after its sources (see the «AI analysis» section).
At the close of 04 Nov 2026, Allison Transmission Holdings Inc. (ALSN) stock was 120.52 USD (+1.35% on the day), with market capitalisation 9.9 bn USD, P/E 17.4 on diluted EPS of 6.94 USD over the last 12 months, dividend yield 0.95%, beta 1.10, 52-week range 79.27–136.00 USD. Latest reported quarter (Q3 2026): revenue of 1.5 bn USD (+121.4% YoY), net income of 191.0 m USD (+39.4% YoY), diluted EPS 2.30 USD.
Data as of · AI analysis dated · Source: SEC filings and closing prices, computed by olivLaw.
Price history
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Technical reading
- RSI (14)
- 64.4
- strong (55–70)
- Bollinger (20, 2)
- 104.17 – 117.74
- above the upper band · %B 1.20 · band width 12.2%
- SMA 50 / 200
- 116.95 / 118.50
- mixed trend
- MACD (12, 26, 9)
- -0.20 / -1.74
- MACD above signal
Indicators describe past prices; on their own they do not predict direction. On our history the RSI ≤ 40 filter added no return (see the signals methodology).
Performance
| Company | S&P 500 | vs S&P 500 | Vertical median | |
|---|---|---|---|---|
| 1 month | +4.1% | −1.1% | +5.2 pp | — |
| 3 months | +2.0% | −0.5% | +2.5 pp | — |
| 6 months | −5.6% | +4.4% | −10.0 pp | — |
| Year to date | +23.1% | +12.3% | +10.8 pp | — |
| 1 year | +51.8% | +13.5% | +38.2 pp | −12.2% |
| 3 years | +130.0% | +76.4% | +53.5 pp | −3.9% |
| 5 years | +241.0% | +63.7% | +177.4 pp | — |
Price returns, dividends excluded.
Quarterly results
Latest quarter: Q3 2026 · 30 Sept 2026
Quarterly margins
Quarterly statements · USD
| Fiscal year | Q4 '24 | Q1 '25 | Q2 '25 | Q3 '25 | Q4 '25 | Q1 '26 | Q2 '26 | Q3 '26 |
|---|---|---|---|---|---|---|---|---|
| Revenue | 796.0 m | 766.0 m | 814.0 m | 693.0 m | 737.0 m | 1.4 bn | 1.6 bn | 1.5 bn |
| Cost of revenue | 423.0 m | 388.0 m | 411.0 m | 363.0 m | 385.0 m | 1.0 bn | 1.1 bn | 1.0 bn |
| Gross profit | 373.0 m | 378.0 m | 403.0 m | 330.0 m | 352.0 m | 406.0 m | 515.0 m | 505.0 m |
| Research & development | 54.0 m | 42.0 m | 43.0 m | 43.0 m | 46.0 m | 54.0 m | 56.0 m | 59.0 m |
| SG&A | 83.0 m | 87.0 m | 104.0 m | 83.0 m | 106.0 m | 157.0 m | 168.0 m | 142.0 m |
| Operating income | 235.0 m | 249.0 m | 256.0 m | 204.0 m | 171.0 m | 195.0 m | 291.0 m | 304.0 m |
| Pre-tax income | 210.0 m | 233.0 m | 242.0 m | 182.0 m | 147.0 m | 132.0 m | 228.0 m | 238.0 m |
| Income tax | 35.0 m | 41.0 m | 47.0 m | 45.0 m | 48.0 m | 20.0 m | 47.0 m | 47.0 m |
| Net income | 175.0 m | 192.0 m | 195.0 m | 137.0 m | 99.0 m | 112.0 m | 181.0 m | 191.0 m |
| Diluted EPS | 1.99 ≈ | 2.23 | 2.29 | 1.63 | 1.16 ≈ | 1.33 | 2.15 | 2.30 |
| Operating cash flow | 211.0 m | 181.0 m | 184.0 m ≈ | 228.0 m ≈ | 243.0 m | 156.0 m | 312.0 m ≈ | 343.0 m ≈ |
| Capex | 75.0 m | 26.0 m | 31.0 m ≈ | 44.0 m ≈ | 74.0 m | 53.0 m | 31.0 m ≈ | 65.0 m ≈ |
| Dividends paid | 21.0 m | 24.0 m | 22.0 m ≈ | 23.0 m ≈ | 22.0 m | 25.0 m | 24.0 m ≈ | 23.0 m ≈ |
| Share repurchases | 121.0 m | 150.0 m | 105.0 m ≈ | 27.0 m ≈ | 46.0 m | 20.0 m | 46.0 m ≈ | 57.0 m ≈ |
≈ derived quarter (cumulative difference / share-days average)
E/P over time
E/P = trailing-12-month diluted EPS / price at quarter end. E/P is the inverse of P/E and stays defined when earnings are negative.
Today's P/E sits at the 88 percentile of its own 40-quarter history (min 6.5, median 10.3, max 26.5; quarters with earnings only).
Fiscal years
| Fiscal year | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenue | 2.7 bn | 2.7 bn | 2.1 bn | 2.4 bn | 2.8 bn | 3.0 bn | 3.2 bn | 3.0 bn |
| Revenue YoY | +19.9% | −0.6% | −22.9% | +15.4% | +15.3% | +9.6% | +6.3% | −6.7% |
| Net income | 639.0 m | 604.0 m | 299.0 m | 442.0 m | 531.0 m | 673.0 m | 731.0 m | 623.0 m |
| Net income YoY | +26.8% | −5.5% | −50.5% | +47.8% | +20.1% | +26.7% | +8.6% | −14.8% |
| Diluted EPS | 4.78 | 4.91 | 2.62 | 4.13 | 5.53 | 7.40 | 8.31 | 7.33 |
| Diluted EPS YoY | +42.3% | +2.7% | −46.6% | +57.6% | +33.9% | +33.8% | +12.3% | −11.8% |
| net % | 23.6% | 22.4% | 14.4% | 18.4% | 19.2% | 22.2% | 22.7% | 20.7% |
| Free cash flow | 737.0 m | 675.0 m | 446.0 m | 460.0 m | 490.0 m | 659.0 m | 658.0 m | 661.0 m |
Reported results vs expectations
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Balance sheet & financial health
Fiscal year 2025 · 31 Dec 2025
- Cash
- 1.5 bn USD
- Financial debt
- 2.9 bn USD
- Net debt
- 1.4 bn USD
- Equity
- 1.9 bn USD
- Total assets
- 6.1 bn USD
- Debt / equity
- 1.55x
- Current ratio
- 4.85x
- ROE
- 35.4%
- ROA
- 10.9%
- FCF margin
- 22.0%
Financial statements (source on every figure)
Revenue and net income (USD)
Margins
Income statement · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Revenue | 2.1 bn | 2.4 bn | 2.8 bn | 3.0 bn | 3.2 bn | 3.0 bn | SEC (XBRL)· 24 Feb 2026verified |
| Cost of revenue | 1.1 bn | 1.3 bn | 1.5 bn | 1.6 bn | 1.7 bn | 1.5 bn | SEC (XBRL)· 24 Feb 2026verified |
| Gross profit | 998.0 m | 1.1 bn | 1.3 bn | 1.5 bn | 1.5 bn | 1.5 bn | SEC (XBRL)· 24 Feb 2026verified |
| Research & development | 147.0 m | 171.0 m | 185.0 m | 194.0 m | 200.0 m | 174.0 m | SEC (XBRL)· 24 Feb 2026verified |
| SG&A | 317.0 m | 305.0 m | 328.0 m | 357.0 m | 336.0 m | 380.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Operating income | 534.0 m | 669.0 m | 784.0 m | 919.0 m | 992.0 m | 880.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Pre-tax income | 393.0 m | 572.0 m | 645.0 m | 827.0 m | 897.0 m | 804.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Income tax | 94.0 m | 130.0 m | 114.0 m | 154.0 m | 166.0 m | 181.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Net income | 299.0 m | 442.0 m | 531.0 m | 673.0 m | 731.0 m | 623.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Diluted EPS | 2.62 | 4.13 | 5.53 | 7.40 | 8.31 | 7.33 | SEC (XBRL)· 24 Feb 2026verified |
| Weighted average diluted shares | 114.0 m | 107.0 m | 96.0 m | 91.0 m | 88.0 m | 85.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Dividend per share | — | — | 0.84 | 0.92 | 1.00 | 1.08 | SEC (XBRL)· 24 Feb 2026verified |
Balance sheet · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Cash | 310.0 m | 127.0 m | 232.0 m | 555.0 m | 781.0 m | 1.5 bn | SEC (XBRL)· 24 Feb 2026verified |
| Receivables | 228.0 m | 301.0 m | 363.0 m | 356.0 m | 360.0 m | 333.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Inventories | 181.0 m | 204.0 m | 224.0 m | 276.0 m | 315.0 m | 316.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Current assets | 756.0 m | 671.0 m | 866.0 m | 1.3 bn | 1.5 bn | 2.2 bn | SEC (XBRL)· 24 Feb 2026verified |
| Property, plant & equipment, net | 638.0 m | 706.0 m | 763.0 m | 774.0 m | 803.0 m | 862.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Goodwill | 2.1 bn | 2.1 bn | 2.1 bn | 2.1 bn | 2.1 bn | 2.1 bn | SEC (XBRL)· 24 Feb 2026verified |
| Intangibles (excl. goodwill) | 963.0 m | 917.0 m | 878.0 m | 833.0 m | 822.0 m | 794.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Total assets | 4.5 bn | 4.5 bn | 4.7 bn | 5.0 bn | 5.3 bn | 6.1 bn | SEC (XBRL)· 24 Feb 2026verified |
| Accounts payable | 157.0 m | 179.0 m | 195.0 m | 210.0 m | 212.0 m | 190.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Short-term debt | 6.0 m | 6.0 m | 6.0 m | 6.0 m | 5.0 m | 5.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Long-term debt | 2.5 bn | 2.5 bn | 2.5 bn | 2.5 bn | 2.4 bn | 2.9 bn | SEC (XBRL)· 24 Feb 2026verified |
| Current liabilities | 373.0 m | 459.0 m | 480.0 m | 501.0 m | 506.0 m | 460.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Total liabilities | 3.7 bn | 3.8 bn | 3.8 bn | 3.8 bn | 3.7 bn | 4.2 bn | SEC (XBRL)· 24 Feb 2026verified |
| Equity | 756.0 m † | 634.0 m † | 874.0 m † | 1.2 bn † | 1.7 bn † | 1.9 bn † | SEC (XBRL)· 24 Feb 2026verified |
† equity attributable to the parent's shareholders: in these years the issuer no longer reports the total including non-controlling interests.
Cash flow · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Operating cash flow | 561.0 m | 635.0 m | 657.0 m | 784.0 m | 801.0 m | 836.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Capex | 115.0 m | 175.0 m | 167.0 m | 125.0 m | 143.0 m | 175.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Free cash flow | 446.0 m ≈ | 460.0 m ≈ | 490.0 m ≈ | 659.0 m ≈ | 658.0 m ≈ | 661.0 m ≈ | SEC (XBRL)· 24 Feb 2026derived |
| Investing cash flow | -111.0 m | -212.0 m | -183.0 m | -129.0 m | -147.0 m | -184.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Financing cash flow | -335.0 m | -604.0 m | -367.0 m | -332.0 m | -427.0 m | 57.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Dividends paid | 78.0 m | 81.0 m | 80.0 m | 83.0 m | 87.0 m | 91.0 m | SEC (XBRL)· 24 Feb 2026verified |
| Share repurchases | 225.0 m | 513.0 m | 278.0 m | 263.0 m | 254.0 m | 328.0 m | SEC (XBRL)· 24 Feb 2026verified |
≈ computed by olivLaw from the reported lines of the same year: Operating cash flow − Capex.
Computed indicators
Growth
Profitability
Returns
Balance sheet
Liquidity
Cash
Efficiency
Market and valuation
Risk
Valuation
olivLaw classification
Score: 70 / 100
A scoring methodology on indicators and valuation, not investment advice.
Closing price
04 Nov 2026Source: olivLaw, closing series
Market cap: 9.9 bn USD
Key indicators
Coverage and freshness
Score by group
- Balance sheet81
- Growth45
- Quality91
- Returns63
- Valuation68
Estimated value range
The combined range = the median of the valid methods' low, central and high values; it is not a probability interval and does not cover every result. Envelope of all methods: 79.52 – 143.37 USD.
Methods computed but outside the aggregate range: Dividend discount (DDM) (a small share of earnings is paid as dividends (capital returns through buybacks): the dividend model does not describe the value and stays outside the aggregate).
Valuation assumptions are editorial choices, not measured; beta is not measured.
Method ranges (USD per share)
— — Mid · ▏ Price
Valuation methods
- DCF (discounted cash flow)unavailable · input data missing
- Peers: EV/EBITDAunavailable · input data missing
- Peers: P/E79.52 – 143.37 (Mid 104.59)19 companies used · median multiple 15.1x · quartiles 11.5x – 20.6xADNT, ALV, APTV, ATMU, BWA, CAAS, DAN, DORM, GNTX, GTX, HLLY, LCII, LEA, MGA, PATK, PHIN, SMP, STRT, VC
- Dividend discount (DDM)outside the aggregate14.19 – 19.09 (Mid 16.28)a small share of earnings is paid as dividends (capital returns through buybacks): the dividend model does not describe the value and stays outside the aggregate
Classification (SIC) comparables group by industry code, not by economic activity; the direct group is an editorial selection by activity. Members' multiples are on their own trailing twelve months, at their own latest close.
Assumptions (illustrative, editorial)
- Risk-free rate
- 4.3%
- Equity risk premium
- 5.0%
- Beta (default)
- 1.00
- Cost of equity
- 9.3%
- Terminal growth
- 2.5%
Factor scorecard
Neutral profile · Score 70/100
| Factor | Value | Score | Weight used |
|---|---|---|---|
| ROIC · Quality | 16.8% | 86 (vs peers) | 14% |
| Net margin · Quality | 11.1% | 91 (vs peers) | 9% |
| FCF conversion · Quality | 142.5% | 100 (on a fixed band) | 9% |
| Revenue CAGR 3Y · Growth | 2.8% | 24 (on a fixed band) | 11% |
| EPS CAGR 3Y · Growth | 9.8% | 66 (on a fixed band) | 11% |
| Net debt / EBITDA · Balance sheet | unavailable | unavailable | — |
| Interest coverage · Balance sheet | unavailable | unavailable | — |
| Current ratio · Balance sheet | 1.8x | 81 (on a fixed band) | 6% |
| P/E (TTM) · Valuation | 17.4x | 43 (vs peers) | 14% |
| EV/EBITDA · Valuation | unavailable | unavailable | — |
| FCF yield · Valuation | 8.4% | 100 (on a fixed band) | 11% |
| Shareholder yield (distributions) · Returns | 2.7% | 38 (on a fixed band) | 9% |
| Payout ratio (FCF) · Returns | 11.3% | 100 (on a fixed band) | 6% |
Factors without a value were dropped; the remaining weights were renormalised.
Score groups
- Balance sheet· partial81/100 · 1/3 factors with a value
- Growth45/100 · 2/2 factors with a value
- Quality91/100 · 3/3 factors with a value
- Returns63/100 · 2/2 factors with a value
- Valuation68/100 · 2/3 factors with a value
A «partial» group is computed from under half of its weight or from one factor: it is not a full assessment of the group.
Memo
ALLISON TRANSMISSION HOLDINGS, INC. (ALSN). Latest full fiscal year: 2025; data up to 2026-09-30.
Figures computed from the financial statements: revenue 3.0 bn USD in 2025; YoY growth -6.7%; net margin 11.1%; ROE 29.7%.
The estimated value range is 79.52–143.37 USD per share (median of 1 methods, agreement: single method); assumptions are illustrative. Against the central value of 104.59 USD, the price of 120.52 USD leaves a potential of -13.2% (value / price − 1) and a margin of safety of -15.2% (1 − price / value). The range is the median of the methods' low, central and high values, not a probability interval.
olivLaw score 70/100, methodological classification: neutral profile (score, margin of safety and method agreement together; not a judgement of the right price). Groups assessed only in part: balance. Not investment advice.
Text generated deterministically from the figures shown; no language model. Not investment advice.
What supports the thesis
- ROIC: 16.8%
- Net margin: 11.1%
- FCF conversion: 142.5%
- Current ratio: 1.8x
- FCF yield: 8.4%
- Payout ratio (FCF): 11.3%
What contradicts it
- Revenue CAGR 3Y: 2.8%
Not assessed (insufficient data or a ratio without meaning): Net debt / EBITDA, Interest coverage, EV/EBITDA.
Versus the vertical median
Motor Vehicle Parts & Accessories (SIC 3714) · same industry (4-digit SIC) · compared with 34 companies
Multiples and returns vs the median
Price rebased to 100 (monthly, 5 years)
Companies in the vertical
| Market cap | P/E | ROE | Net margin | Revenue YoY | 1A / 3A | |
|---|---|---|---|---|---|---|
| MGAMagna International Inc. | 18.4 bn | 22.4 | 6.9% | 2.0% | −1.9% | +34% / +22% |
| BWABorgwarner Inc. | 10.1 bn | 21.5 | 8.2% | 3.4% | +1.6% | +17% / +50% |
| ALSNAllison Transmission Holdings, Inc. | 9.9 bn | 17.4 | 29.7% | 11.1% | −6.7% | +52% / +130% |
| ALVAutoliv, Inc. | 9.0 bn | 15.1 | 24.8% | 5.6% | +4.1% | +7% / +21% |
| APTVAptiv PLC | 8.8 bn | 11.9 | 8.5% | 4.6% | +3.5% | −44% / −48% |
| LEALear Corp | 5.7 bn | 10.4 | 11.6% | 2.5% | −0.2% | +11% / −11% |
| MODModine Manufacturing Co | 5.2 bn | 41.3 | 11.4% | 3.6% | +23.1% | −39% / +100% |
| GNTXGentex Corporation | 4.4 bn | 11.0 | 16.4% | 15.5% | +9.6% | −9% / −32% |
| DORMDorman Products, Inc. | 4.2 bn | 21.2 | 13.3% | 9.3% | +6.0% | +8% / +98% |
| ATMUAtmus Filtration Technologies Inc. | 3.9 bn | 18.3 | 55.8% | 11.3% | +5.7% | −5% / +119% |
| GTXGarrett Motion Inc. | 3.6 bn | 10.1 | — | 10.0% | +3.1% | +20% / +167% |
| PATKPatrick Industries Inc | 2.7 bn | 20.1 | 13.0% | 3.7% | +6.3% | −22% / +55% |
| PHINPhinia Inc. | 2.6 bn | 14.5 | 12.2% | 5.2% | +2.4% | +33% / +181% |
| DANDana Incorporated | 2.6 bn | 2.4 | 71.4% | 14.6% | −3.0% | +6% / +80% |
| LCIILci Industries | 2.5 bn | 12.1 | 15.0% | 5.2% | +10.2% | −8% / −4% |
| VCVisteon Corp | 2.0 bn | 13.8 | 10.8% | 4.1% | −2.5% | −22% / −32% |
| THRMGentherm Incorporated | 1.6 bn | 105.3 | 1.3% | 0.6% | +2.9% | −13% / −32% |
| ADNTAdient plc | 1.3 bn | 28.5 | 2.7% | 0.3% | −1.0% | −12% / −47% |
| DCHDauch Corporation | 1.1 bn | — | -15.2% | -2.0% | −4.7% | −27% / −31% |
| SMPStandard Motor Products, Inc. | 1.0 bn | 15.1 | 9.9% | 3.8% | +22.4% | +22% / +28% |
| AEVAAeva Technologies, Inc. | 661.5 m | — | — | -150.1% | +99.4% | −15% / +240% |
| CPSCooper-Standard Holdings Inc. | 391.6 m | — | — | -2.0% | +0.4% | −29% / +24% |
| HLLYHolley Inc. | 351.6 m | 35.3 | 2.3% | 1.7% | +1.9% | −32% / −30% |
| KNDIKandi Technologies Group, Inc. | 287.8 m | — | -30.5% | -107.4% | −31.5% | −63% / −88% |
| STRTStrattec Security Corp | 258.5 m | 15.6 | 7.2% | 2.9% | +2.5% | −14% / +201% |
1- and 3-year price returns: for ALSN from daily closes (the same as the performance table), for the other companies from month-end closes.
olivLaw engine forecast
The world engine ran after the company's latest material disclosure. Probabilities are of TOUCHING a level within the horizon (not closing there) and sit next to the random walk (p_rw), the no-information benchmark.
The engine has no published run for this company yet.
Valuation scenarios (editable assumptions)
Illustrative scenarios
Illustrative: not forecasts and without probabilities. Each case is one coherent set of assumptions, computed on today's figures.
Estimated price (USD)
| Estimated price | Bear | Base | Bull |
|---|---|---|---|
| 1 years | 71.58 Total return -40% · Per year -40% | 126.66 Total return 6% · Per year 6% | 190.92 Total return 60% · Per year 60% |
| 3 years | 67.15 Total return -42% · Per year -17% | 133.90 Total return 14% · Per year 5% | 221.96 Total return 88% · Per year 23% |
| 5 years | 62.99 Total return -44% · Per year -11% | 141.57 Total return 23% · Per year 4% | 258.03 Total return 121% · Per year 17% |
- Exit P/E± 33.48
- Net margin± 23.43
- Annual revenue growth± 19.55
- Annual dilution± 1.97
AI analysis
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
Possibly outdated: the newest document it read is from 05 Aug 2026; since then the company filed 10-Q (04 Nov 2026), 8-K (02 Nov 2026 · results).
In brief
Allison Transmission is the world's largest maker of fully automatic transmissions for medium- and heavy-duty commercial vehicles and a key supplier for U.S. defense vehicles. Since January 1, 2026 it has integrated the off-highway business bought from Dana, which broadened its revenue base after annual net sales of 3010 million USD in 2025 12.
SWOT
Strengths
- Leading global position in fully automatic commercial vehicle transmissions and strong brand recognition 1.
- High margins and solid cash generation, with adjusted profitability that compares well with the industry 13.
- Long-term contracts with OEM customers and an extensive distribution and service network 1.
Weaknesses
- High dependence on a few large OEM customers and a limited number of suppliers for critical components 1.
- Significant debt after the off-highway acquisition, which narrows financial flexibility 13.
- Exposure to economic cycles in end markets, where demand for durable vehicles can be deferred quickly 1.
Opportunities
Threats
Risks
- Customer concentrationhigh
Sales are concentrated among the largest OEM customers. Losing one of them or the discontinuation of models could significantly reduce sales 1.
- Acquisition integrationhigh
Integrating the Dana business involves costs and operational risks; if it is not completed on time, results could be affected 13.
- Indebtednessmedium
Total debt rose after the acquisition, and servicing it requires steady cash flow that depends on factors largely outside the company's control 13.
- Raw material costsmedium
Higher prices for steel, aluminum and precious metals could reduce margins, since recovering costs from customers lags by several months 1.
- Defense contracting riskslow
Contracts with the Department of Defense carry specific terms and restrictions that could affect financial results if programs change 1.
Investment thesis
What would need to be true (bull case)
- If the recovery in off-highway demand and defense growth continue, the company could exceed its 2026 sales and cash flow guidance 3.
- Its leading position in automatic transmissions and high margins could support the cash flow needed to reduce debt 13.
- Expansion into off-highway could diversify revenue and reduce reliance on North American trucks 1.
What would break the thesis
- If integration of the acquired business is delayed or synergies fail to materialize, costs and amortization could weigh on profitability 3.
- If North American on-highway sales keep declining, revenue from the largest segment could be affected 1.
- High indebtedness could limit investment and the ability to withstand an economic slowdown 13.
What to watch
- Progress on integrating Allison Off-Highway and realization of synergiesQ3 2026
- Trend in North American on-highway sales and truck order activityQ3 2026
- Reduction of debt and achievement of the leverage target2027
Products, market & competition
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
Possibly outdated: the newest document it read is from 05 Aug 2026; since then the company filed 10-Q (04 Nov 2026), 8-K (02 Nov 2026 · results).
The business
Allison Transmission Holdings Inc. (NYSE: ALSN) designs and manufactures fully automatic transmissions and propulsion solutions for trucks, buses, off-highway vehicles and defense vehicles. The company was founded in 1915 and is headquartered in Indianapolis, Indiana 1. Approximately 76% of 2025 revenues came from North America, and the distribution network includes about 1500 independent distributor and dealer locations 1. From January 1, 2026 the company operates two business units: Allison Transmission and Allison Off-Highway Drive & Motion Systems, the latter resulting from the acquisition from Dana for an approximate purchase price of 2628 million USD 12. The revenue mix is therefore shifting toward a more diversified portfolio.
Segments
Allison Off-Highway Drive & Motion Systems
The unit acquired from Dana supplies drivetrain, axle and motion solutions for construction, agriculture, mining and material handling equipment. It contributed 706 million USD of net sales in the second quarter of 2026, with a segment adjusted EBITDA margin of 15% in that quarter 23. The company says integrating this unit remains a top priority.
Trends
- Off-highway demand recoverytailwind
Mining and construction sales have started to rebound from trough levels, according to the second quarter 2026 results, although agriculture has not yet inflected. If this recovery holds, it could support the newly acquired unit.
- Defense growthtailwind
Defense sales grew 26% in 2025, supported by demand for tracked vehicle applications and new growth initiatives 1. Contracts with the Department of Defense carry specific risks.
- Electrification of vehiclesheadwind
A faster shift to electric propulsion could reduce the share of traditional transmissions if competitors develop new technologies more quickly 1.
- Acquisition integration and debt loadmixed
Integrating the Dana business brings significant one-time costs and a high debt load that may limit financial flexibility, although adjusted cash flow was strong in the second quarter 13.
Competitive position
In trucks, Allison competes with independent makers of manual and automated manual transmissions, with fully automatic transmissions from Ford, ZF and Driventic, and with vertically integrated OEMs 1. In off-highway and defense, competitors include integrated makers such as Caterpillar and Komatsu and independent suppliers such as ZF and Twin Disc 1.
- ZF Friedrichshafen AG
Supplier of automatic transmissions for trucks, off-highway and defense, present in all of the company's main markets 1.
- Caterpillar Inc.CAT
Vertically integrated manufacturer competing in energy, mining and construction off-highway applications 1.
- Twin Disc, Inc.
Competitor in off-highway transmissions for energy and specialty vehicles, including firefighting equipment 1.
- Driventic GmbH
Automatic transmission supplier competing in truck markets in and outside North America 1.
Links, dependencies and risks
Who the company is tied to, from its own SEC filings (customers, suppliers, production, partners, competitors, countries, regulation), from the 5 %+ holders' statements (13D/13G) and from what other companies say about it. Click a node for its evidence; on a listed company the graph moves to it.
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News & filings
In the press
- Allison Pearson said to be negotiating exit from Daily Telegraph amid job cullThe Guardian World · 28 Oct 2026 · EN
- How Allison Transmission Holdings (ALSN) is Capturing New Markets Beyond Commercial VehiclesYahoo Finance — News · 15 Sept 2026 · EN
- Discuții între premierul Ilie Bolojan și subsecretarul SUA Allison Hooker – Securitatea regională, investițiile americane și aderarea la OCDE, pe agendăCursDeGuvernare.ro · 09 Jul 2026 · RO
- Premierul Bolojan, întâlnire cu Allison Hooker, subsecretar de stat pentru afaceri politice din cadrul Departamentului de Stat al SUADigi24 · 09 Jul 2026 · RO
- Întâlnire între premierul Ilie Bolojan și Allison Hooker, subsecretar de stat pentru afaceri politice în cadrul Departamentului de Stat al SUA / Securitatea regională și colaborarea economică, pe agenda întrevederiiG4Media · 09 Jul 2026 · RO
- James Allison, directorul echipei, dezvăluie când ar putea Mercedes să favorizeze pe unul dintre piloții săi din F1G4Media · 23 Jun 2026 · RO
The latest news item in our archive is from 28 Oct 2026; the newest SEC filing is from 04 Nov 2026. The press archive comes from the RSS feeds we follow and does not necessarily cover the latest event — the filings alongside do.
SEC filings
- Quarterly report04 Nov 2026
- Current report02 Nov 2026Results of operations · Financial statements and exhibits
- Quarterly report05 Aug 2026
- Current report03 Aug 2026Results of operations · Financial statements and exhibits
- Current report16 Jun 2026Material agreement · Regulation FD disclosure · Financial statements and exhibits
- Current report08 May 2026Departure or appointment of officers · Shareholder vote
- Quarterly report07 May 2026
- Current report04 May 2026Results of operations · Financial statements and exhibits
- Proxy statement25 Mar 2026
- Current report (amendment)16 Mar 2026Financial statements and exhibits
Sources
- [1] Form 10-K, fiscal year ended 2025-12-31 · SEC / Allison Transmission Holdings Inc. · 24 Feb 2026
- [2] Form 10-Q, quarter ended 2026-06-30 · SEC / Allison Transmission Holdings Inc. · 05 Aug 2026
- [3] Form 8-K, results release (exhibit 99.1) · SEC / Allison Transmission Holdings Inc. · 03 Aug 2026
Figures computed by olivLaw from SEC filings and closing prices; the qualitative analysis is AI-generated from cited sources. Not investment advice.