Munger Mode rating: 4 out of 5 — Buy. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Charlie and I have always said we'd rather own a toll bridge than a factory. Allegion is something close to a toll bridge on the doorways of America's schools, hospitals, offices, and universities. It makes locks, exit devices, door closers, and increasingly the electronic credentials that open them — under brands (Schlage, Von Duprin, LCN) that architects have been writing into building specifications for over a century. The Americas business earns 29% segment operating margins, the company as a whole earns roughly 20% on invested capital, it converts nearly all of its earnings into cash, and it carries a modest debt load with staggered maturities. The second quarter of 2026, reported July 23, was excellent: revenue up 12.7% to $1.15 billion, adjusted EPS up 17.6% to $2.40, and full-year guidance raised to $8.85–$9.00.
Recent filings analysed: 10-Q (2026-07-23), 8-K (2026-07-23), 8-K (2026-06-09), 10-Q (2026-04-28).
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