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ASSA ABLOY (ASAZY) to Buy Industrial Door Company AM Group

Zacks Equity Research

ASSA ABLOY AB ASAZY recently entered into a definitive deal to acquire AM Group. Conditional upon regulatory approvals and customary closing conditions, the deal is anticipated to conclude in first-quarter 2020. The financial terms of the transaction are still kept under wraps.

Based in Sydney, Australia, AM Group is primarily engaged in producing and offering a diverse range of products and services for building construction and transportation industries. AM Group’s proficiency lies in manufacturing various commercial and industrial door products that include steel roller shutters, aluminium folding and stacking doors, bi-fold doors and tilt doors, among others. Founded in 1923, this industrial door company employs 425 people.

The buyout will enable ASSA ABLOY to strengthen product offerings. Backed by expanded product offerings in the entrance automation market, the company expects the buyout to augment its market presence in Australia. Notably, ASSA ABLOY expects this acquisition to be accretive to earnings per share immediately.

Notable Inorganic Moves

A notable inorganic move by the company was the buyout of Australia-based Placard in September 2019. The buyout enabled the company to strengthen its secure cards offering, particularly in the Australasia region. In addition, the company concluded the acquisition of LifeSafety Power in the same month. Notably, this buyout will help ASSA ABLOY in strengthening its offerings within the access control portfolio.

ASSA ABLOY currently carries a Zacks Rank #4 (Sell). In the past three months, the stock has gained 6.3% compared with the industry’s growth of 5.1%.

Stocks to Consider

Some better-ranked stocks from the same space are Napco Security Technologies, Inc. NSSC, Allegion plc ALLE and Intellicheck, Inc. IDN. While Napco sports a Zacks Rank #1 (Strong Buy), Allegion and Intellicheck carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Napco delivered average positive earnings surprise of 41.87% in the trailing four quarters.

Allegion delivered average positive earnings surprise of 2.17% in the trailing four quarters.

Intellicheck delivered average positive earnings surprise of 4.76% in the trailing four quarters.

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