Sustainable Free Cash Flow
Long/short equity, value, special situations, growth

Allisons Big Move Higher Looks Sustainable

Small Public Float; International Potential

Allison Transmission (NYSE:ALSN) became an independent entity in 2007 when Carlyle and Onex purchased the company for $5.6 billion from General Motors. In March of 2012, Carlyle and Onex took the company public. Since the initial public offering, Allison Transmission has continued operating as a top developer and manufacturer of fully automatic transmissions for medium- and heavy-duty vehicles. Their financial performance is highly correlated to macroeconomic conditions. Although the stock has increased approximately 25% over the past year, the potential for additional growth exists. Onex and Carlyle are still heavily invested and control the operations of the firm. The two combined hold approximately 70% of the equity and have strong track records in...

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