Overview

• U.S. transmission maker's Q1 net sales rose 84% yr/yr, driven by Off-Highway acquisition

• Company repurchased over $20 mln of stock during the quarter

Outlook

• Company reaffirms 2026 consolidated net sales guidance of $5.575 bln to $5.925 bln

• Company sees 2026 consolidated net income of $600 mln to $750 mln, including one-time costs

• Company expects 2026 adjusted EBITDA of $1.365 bln to $1.515 bln

Result Drivers

• OFF-HIGHWAY ACQUISITION - Addition of Off-Highway business unit drove most of the increase in consolidated net sales

• LEGACY SALES DECLINE - Allison Transmission business unit sales fell 4% yr/yr due to lower volumes and unfavorable direct material costs, partially offset by price increases

• ACQUISITION-RELATED COSTS - Net income was negatively impacted by $76 mln of acquisition-related expenses, including inventory step-up and incremental depreciation

Company press release: ID:nPnzhc17a

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q1 Sales	Beat	$1.41 bln	$1.38 bln (7 Analysts)
Q1 EPS		$1.33
Q1 Net Income		$112 mln
Q1 Basic EPS		$1.35
Q1 Operating income		$252 mln
Q1 Pretax Profit		$132 mln

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 6 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the heavy machinery & vehicles peer group is "buy"

• Wall Street's median 12-month price target for Allison Transmission Holdings Inc is $131.00, about 0.2% below its May 1 closing price of $131.23

• The stock recently traded at 14 times the next 12-month earnings vs. a P/E of 11 three months ago

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