Allison Transmission Holdings, Inc. research snapshot
ALSN AI stock analysis currently reads Allison Transmission Holdings, Inc. as a high-margin industrial drivetrain business with a defensible installed base, strong service economics, a larger global footprint after acquiring Dana’s Off-Highway Drive & Motion Systems business, and rising defense order flow. The stock closed at $114.54 on July 31, 2026, implying about $9.50 billion of equity value using 82.94 million shares. The most recently reported quarter is Q1 2026: net sales of $1.406 billion including $673 million from the acquired Off-Highway unit, net income of $112 million, and adjusted diluted EPS of $2.57 up 6% year over year. The company reaffirmed 2026 guidance of $5.575 billion to $5.925 billion of net sales, $600 million to $750 million of net income, and $655 million to $805 million of adjusted free cash flow. Recent catalysts include a $250 million BAE Systems CV90 MkIV tracked defense contract with a $50 million option, an order to supply transmissions for about 3,000 GDELS EAGLE V vehicles, and inclusion in the S&P MidCap 400 on July 6, 2026. Q2 2026 results are scheduled for release after market close on August 3, 2026, after this page’s data cutoff. The main debate is whether Allison can integrate the acquired business, keep lowering net leverage toward 2.0x, and protect its transmission moat as heavy-duty vehicles electrify. This page is informational research and is not investment advice.
Current price
$114.54 close on July 31, 2026
Market cap
$9.50 billion using 82.94 million shares; price times shares verified with 0.00% variance
AI score
70 / 100
Rating
High-margin transmission franchise with installed-base economics, defense order momentum, and deleveraging progress, offset by acquisition integration and electrification uncertainty
Trend status
Price is below the 50-day moving average near $116.19 but above the 200-day moving average near $109.35, so the long-term trend is constructive while near-term momentum is soft ahead of the August 3, 2026 earnings report
Data cutoff (updated monthly)
August 4, 2026
Informational use only. This page is not investment advice.
| Dimension | Conclusion | Confidence |
|---|---|---|
| Business quality | Allison sells fully automatic transmissions, propulsion systems, service parts, and off-highway drive and motion solutions for commercial, defense, construction, mining, energy, and agricultural applications. | High |
| Moat | The moat comes from engineering know-how, field validation, an installed base, distributor coverage, service parts, and customer switching friction. It is strongest in heavy-duty and defense applications where reliability matters and weakest where electric drivetrains can bypass a conventional transmission. | High |
| Management | CEO David Graziosi has deep Allison finance and operating experience. The key management test is whether the Dana acquisition earns its cost, captures the targeted synergies, and still allows disciplined deleveraging and shareholder returns. | Medium-high |
| Financial trend | Standalone FY2025 revenue fell 6.7% to $3.010 billion and net income fell 14.8% to $623 million, but adjusted free cash flow remained $661 million. Q1 2026 net sales rose 84% to $1.406 billion with the Off-Highway addition, and adjusted EBITDA rose 22% to $362 million, while GAAP net income fell to $112 million on acquisition costs, higher amortization, and higher interest expense. | High |
| Valuation | At $114.54, the trailing PE near 17.8x is distorted by acquisition-related costs, while the forward PE near 11.3x and PEG near 0.6 look reasonable if guidance holds and deleveraging continues. | Medium |
| Technical trend | Price sits below the 50-day moving average near $116.19 and above the 200-day moving average near $109.35. RSI near 45 signals neutral momentum after a late-July pullback from the $122 to $124 area. | Medium |
| Risk level | Risk is medium-high because total debt reached $4.292 billion at Q1 2026, interest expense rose, and integration, heavy-duty and off-highway cycles, defense timing, and electrification can all affect cash conversion. | High |
| AI confidence | The data confidence is high for reported figures and current technical snapshots, but lower for long-range normalized earnings and the timing of synergy and defense revenue realization. | High data confidence |
| Investment certainty | Investment certainty is medium because the core franchise is proven and defense momentum is improving, yet the acquisition creates a new balance-sheet and execution phase at the same time that powertrain technology is changing. | Medium |
ALSN AI stock forecast
The ALSN AI stock forecast uses a three-year scenario model around the $114.54 cutoff price. Using the forward EPS near $10.16 implied by the forward PE of 11.27, the financial-rigor model produced a bullish value near $140 to $170, a base value near $100 to $130, and a bearish value near $60 to $85. These are conditional scenario outputs, not promises or analyst targets.
$140 to $170
More likely if the Off-Highway business tracks the upper guidance range, integration costs fade, synergies improve margins, defense contracts such as the BAE CV90 and GDELS orders ramp on schedule, and net leverage moves toward 2.0x while the market keeps a forward earnings multiple near current levels.
$100 to $130
More likely if Allison delivers the middle of 2026 guidance, maintains strong core margins, absorbs acquisition costs gradually, and reduces debt while forward earnings grow modestly and the multiple stays in the low double digits.
$60 to $85
More likely if heavy-duty and off-highway demand weaken, integration costs persist, debt service limits buybacks, defense revenue is delayed, the 200-day trend fails, or customers accelerate a shift toward electric powertrains that bypass Allison’s conventional transmission content.
ALSN AI technical analysis
ALSN AI technical analysis uses public market data available at the August 3, 2026 cutoff. The latest public close was $114.54 on July 31, 2026. StockAnalysis reported a 50-day moving average near $116.19, a 200-day moving average near $109.35, RSI near 45.13, and beta near 0.95. The stock pulled back from a late-July area near $122 to $124. Technical levels describe market structure and do not predict the next price move.
| Level | Value | Why it matters |
|---|---|---|
| Current price | $114.54 | Latest public close used for this page, dated July 31, 2026. |
| Near support | $109 to $113 | The July 8 low near $109.71 and the June 30 low near $110.79 form the first support band below the current price. |
| Trend support | $106 to $110 | The 200-day moving average was near $109.35 at the cutoff. A sustained break below this zone would weaken the long-term trend. |
| Near resistance | $116 to $121 | The 50-day moving average near $116.19 and the July 2 high near $120.75 create the first overhead resistance zone. |
| Higher resistance | $123 to $126 | The July 24 high near $123.58 and the June 25 high near $125.90 are the next reference points, followed by the 52-week high near $137.62. |
| 50-day moving average | About $116.19 | Price below this average indicates short-term trend pressure as of the July 31, 2026 data snapshot. |
| 200-day moving average | About $109.35 | Price above this average keeps the longer-term trend constructive, subject to confirmation from the August 3 earnings report and cash flow. |
| Momentum | RSI near 45.13 | The RSI snapshot shows neutral momentum after the late-July pullback but is not, by itself, a buy or sell signal. |
| Volume | About 693k shares on July 31, 2026 | Daily volume came from the StockAnalysis historical price table. Volume spiked on July 2, 2026 around the S&P MidCap 400 inclusion and again on the July 29 decline. |
| Volatility | 52-week range $76.01 to $137.62; beta near 0.95 | The wide annual range makes position sizing and predefined risk limits important for any trading framework. |
| Invalidation | A sustained close below $106 | A decisive break below the 200-day support zone would invalidate the constructive long-term technical setup. |
ALSN AI trading strategy
The ALSN AI trading strategy is a rules-based framework, not personalized advice. Pair price signals with order trends, truck and construction demand, defense contract milestones, Off-Highway integration progress, adjusted free cash flow, net debt, and customer powertrain choices.
Consider a trend-following framework only after price reclaims the 50-day average near $116.19, holds above it, and confirms the move with stronger volume plus stable core transmission sales, defense order updates, or improving guidance from the August 3 report.
A close back below the 50-day average reduces confidence. A sustained close below the $106 to $110 200-day zone invalidates the longer-term trend setup.
If price tests the 200-day zone while cash generation, integration milestones, defense contracts, and net leverage remain on plan, compare the setup with normalized EPS and free cash flow rather than a single quarter affected by purchase accounting.
Do not average down automatically if debt, interest expense, core volumes, integration costs, or electric powertrain adoption show structural deterioration.
Track consolidated and core segment revenue, adjusted EBITDA margin, acquisition-related costs, adjusted free cash flow, total debt, net leverage, repurchases, dividend growth, defense contract announcements and delivery timing, and the mix of electric, hybrid, and conventional products.
Reduce confidence when the stock rises on multiple expansion while debt stays elevated, core sales fall, defense timing slips, or the acquired business misses its guided revenue and synergy path.
Investment research summary
Allison sells propulsion hardware and related service support that helps commercial, defense, and industrial vehicles move reliably. Customers pay for uptime, durability, fuel efficiency, validated engineering, and a support network across more than 150 countries, with service parts adding a recurring revenue stream.
The moat is built from decades of engineering, field validation, an installed base, service parts, distributor relationships, and switching friction in mission-critical vehicles. Brand, scale, and defense certifications reinforce the moat, while electric drivetrains can narrow it in selected applications.
The thesis fails if the Dana acquisition destroys cash returns, core transmission demand rolls over, electric powertrains replace Allison content faster than new products scale, debt stays high, or off-highway markets and defense deliveries remain weak. The market may also be right to discount a company with strong margins but a changing technology base and an earnings number still absorbing integration costs.
David Graziosi has served as CEO since 2018 and as Chair since 2021, with prior Allison finance and operating roles. Capital allocation has combined debt management, dividends, and buybacks, including a seventh consecutive annual dividend increase and more than $20 million of Q1 2026 repurchases. The current proof point is whether management can integrate a roughly $2.7 billion acquisition while protecting returns on capital.
The long-term industrial trend favors efficient, reliable mobility for freight, construction, mining, agriculture, energy, and defense. Defense budgets in Europe and elsewhere are rising, which supports tracked and tactical vehicle programs. The technology path can shift from conventional transmissions toward hybrid and electric systems, creating both product opportunity and substitution risk.
At $114.54, the stock trades near 17.8x trailing EPS, near 11.3x forward earnings, and near 15.6x trailing free cash flow per share of $7.34. That is not a deep-value price after the share recovery from late 2025. Margin of safety depends on synergy capture, debt reduction, resilient core margins, defense order execution, and a credible response to electrification.
Source-backed data
Every metric below includes a source and last verification date.
| Metric | Value | Source | Last verified |
|---|---|---|---|
| Current price | $114.54 close on July 31, 2026 | StockAnalysis historical prices | August 3, 2026 |
| Shares outstanding | 82.94 million shares; 82.83 million in the 2025 10-K | StockAnalysis statistics and Allison 2025 10-K | August 3, 2026 |
| Market capitalization | $9.50 billion computed from $114.54 x 82.94 million shares | Financial rigor market-cap verification | August 3, 2026 |
| Valuation ratios | Trailing PE 17.82, forward PE 11.27, PEG 0.60, PS 2.60, P/FCF 15.60, EV/EBITDA 13.51 | StockAnalysis statistics | August 3, 2026 |
| FY2025 revenue and net income | $3.010 billion revenue and $623 million GAAP net income | Allison 2025 Form 10-K | August 3, 2026 |
| Five-year financial trend | Revenue grew from $2.402 billion in FY2021 to $3.010 billion in FY2025; FY2025 gross margin was 48.60% | StockAnalysis income statement and Macrotrends revenue series | August 3, 2026 |
| FY2025 adjusted free cash flow | $661 million, after $175 million of additions to long-lived assets | Allison 2025 annual report | August 3, 2026 |
| Q1 2026 consolidated results | Net sales $1,406 million, net income $112 million, adjusted diluted EPS $2.57, adjusted EBITDA $362 million, adjusted free cash flow $103 million | Allison Q1 2026 results press release | August 3, 2026 |
| Q1 2026 segment revenue | $733 million Allison Transmission and $673 million Allison Off-Highway | Allison Q1 2026 results press release | August 3, 2026 |
| Q1 2026 liquidity and debt | $311 million cash, $4,292 million total debt, and $3,981 million net debt | Allison Q1 2026 Form 10-Q | August 3, 2026 |
| 2026 guidance | $5.575 billion to $5.925 billion net sales, $600 million to $750 million net income, and $655 million to $805 million adjusted free cash flow | Allison Q1 2026 guidance update | August 3, 2026 |
| Technical snapshot | 50-day average $116.19, 200-day average $109.35, RSI 45.13, beta 0.95 | StockAnalysis statistics | August 3, 2026 |
| Short interest and 52-week range | Short interest 3.94 million shares (4.75% of shares out); 52-week range $76.01 to $137.62 | StockAnalysis statistics | August 3, 2026 |
| Dana Off-Highway acquisition | Completed January 1, 2026 for approximately $2.7 billion | Allison acquisition announcement | August 3, 2026 |
| BAE Systems CV90 MkIV contract | $250 million contract with $50 million option for 4040 MX transmissions; largest tracked defense order in Allison history; deliveries start 2028 | Allison press release | August 3, 2026 |
| S&P MidCap 400 inclusion | Allison replaced Goodyear Tire & Rubber effective July 6, 2026 | S&P Dow Jones Indices announcement | August 3, 2026 |
| Q2 2026 earnings date | Scheduled for after market close on August 3, 2026, after this page’s data cutoff | Allison earnings call announcement | August 3, 2026 |
| Chief executive background | David S. Graziosi has served as Chair and CEO since 2021 and CEO since June 2018 | Allison leadership page | August 3, 2026 |
This ALSN page is an informational research tool, not investment advice, a recommendation, or a promise of returns. Forecast ranges are conditional scenarios based on available data and assumptions as of August 3, 2026. Q2 2026 results were scheduled for release after market close on that date and are not reflected here. Data can be delayed, incomplete, or wrong, and investors should verify filings and consider their own objectives and risk tolerance.
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