Henrik5000
Investment Thesis
Over the past decade, Allison Transmission Holdings, Inc. (NYSE:ALSN) delivered annual compounded double-digit profit growth. The company achieved this despite modest revenue growth by improving operating and capital efficiencies. Allison is also financially sound with a good capital allocation plan. Despite being a wonderful company in the Buffett sense, the market has yet to recognize this. My valuation showed more than a 30% margin of safety at the current market price.
Business background
Allison is the world’s largest manufacturer of fully automatic transmissions for medium and heavy-duty commercial and U.S. defense vehicles. It is also a leader in electrified propulsion systems.
Its products are used across various applications, including trucks, buses, motorhomes, off-highway equipment, and defense vehicles. The company also sells branded replacement parts, support equipment, and other parts…
