Allison’s (ALSN) Defense Network Expansion to Reduce Costs


Allison Transmission Holdings Inc.


ALSN

recently announced plans to expand its tracked defense service network for better access to service and support for end users Outside North America (“ONA”).

Allison’s ONA defense network will offer service and support for its cross-drive propulsion systems, including the X200 Series transmission designed for light to light-medium tracked vehicles and the X1100 Series transmission developed for heavy-tracked combat vehicles.

Allison will join forces with its existing channel partners to grow its network of authorized defense distributors for cross-drive transmission products. End users can lay their hands on tracked combat vehicles such as the X1100 Series and X200 Series serviced quickly and more efficiently, which will bring down the overall cost and vehicle downtime for maintenance. Presently, Allison has formed contracts with seven of its channel partners to start selling defense parts in their respective regions — Egypt, Germany, Turkey, Sweden, Finland, Australia and Saudi Arabia.

Allison is committed to improving the availability of parts and ensuring access to localized service and support through its global customer support network. It aims to bring to its customers reliable, durable propulsion systems for the large, fielded population of tracked defense vehicles.

Regular product launches, including FracTran, the firm’s next-generation hydraulic fracturing transmission, represents $100 million annually in incremental revenue potential for Allison’s global off-highway end markets. TerraTran, an innovative propulsion solution purpose-built for the global construction and mining markets, is also set to buoy ALSN’s prospects. Allison’s 3414 Regional Haul Series fully automatic transmission designed for the heavy-duty regional haul and day cab tractor market underscores the company’s commitment to innovation. It presents an annual incremental revenue potential of $100 million for Allison in the North American heavy-duty day cab tractor market. Accelerated development of products that cater to electrification and fuel-cell markets for commercial vehicles augur well. The launch of 100S and 130D e-axles has enriched Allison’s EGen Power portfolio.

Shares of ALSN have lost 19.3% over the past year compared with its

industry

’s 45.4% decline.

Zacks Investment Research

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Zacks Rank & Key Picks

ALSN currently carries a Zacks Rank #3 (Hold).

Better-ranked players in the auto space include

BRP Group, Inc.


DOOO

and

Tesla, Inc.


TSLA

, sporting a Zacks Rank #1 (Strong Buy), and

Visteon Corporation


VC

, each carrying a Zacks Rank #2 (Buy), currently. You can see


the complete list of today’s Zacks #1 Rank stocks here


.

BRP Group has an expected earnings growth rate of 9.1% for fiscal 2023. The Zacks Consensus Estimate for current-year earnings has been revised around 7.9% upward in the past 60 days.

BRP Group’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 68%, on average. The stock has declined 13% over the past year.

Tesla has an expected earnings growth rate of 44% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 4.4% upward in the past 60 days.

Tesla’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. TSLA pulled off a trailing four-quarter earnings surprise of 33.3%, on average. The stock has risen 34.8% over the past year.

Visteon has an expected earnings growth rate of 104.3% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 9.4% upward in the past 60 days.

Visteon’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed in the remaining. VC pulled off a trailing four-quarter earnings surprise of 209.9%, on average. The stock has declined 18.5% over the past year.


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