Is Allison Transmission Holdings, Inc. overvalued or undervalued?

As of 30 July 2025, the valuation grade for Allison Transmission Holdings, Inc. has moved from very attractive to attractive. The company appears to be fairly valued given its P/E ratio of 12, a PEG ratio of 0.80, and an EV to EBITDA ratio of 9.22. In comparison to peers, Autoliv, Inc. has a P/E of 18.06 and a PEG of 2.72, while Gentex Corp. shows a P/E of 15.33 and an EV to EBITDA of 10.91, indicating that Allison is positioned more favorably in terms of valuation metrics.
Despite the recent stock performance showing a decline of 17.61% year-to-date compared to the S&P 500's gain of 12.22%, the company's strong ROE of 45.00% and ROCE of 30.36% suggest robust operational efficiency. Overall, Allison Transmission Holdings, Inc. is fairly valued in the current market context.