This year has seen a plethora of IPOs. However, a glance at the names debuting on the exchanges will reveal that most of them are young, high-growth companies operating primarily in the domains of pharma, tech, or fintech. Thus, when a more than a century-old company goes for an initial public offering (IPO), it is surely noteworthy.

About Alliance Laundry

Founded in 1908, Wisconsin-based Alliance Laundry (ALH) designs, manufactures, and sells commercial laundry equipment such as washers, dryers, and ironers for large-scale, industrial, laundromat, multi-housing, hotel, and on-premises use. It operates under several well-known brands, including Speed Queen, UniMac, Huebsch, Primus, and IPSO.

Alliance Laundry priced its IPO in the range of $19-$22 per share, intending to raise about $750 million by offering 34.15 million shares. Well, the IPO exceeded the company's expectations as it raised $826.3 million at the top end of the expected range, with the shares opening at a premium of more than 11% over the offer price. The company intends to primarily use the net proceeds from this IPO to repay its existing debt.

So, after a strong debut, is ALH stock a counter that can be in investors' portfolios? Let's take a look.

High On Stability, Low On Growth

Alliance Laundry's financials are typical for a mature company marked by profitability and revenues, with searing growth in none of them. For instance, since 2022, its revenues have grown by just 9.6% to $1.51 billion in 2024, whereas net profits have actually declined to $98.3 million from $99.7 million in 2022. However, operating profits have grown by a much sharper 32.2% in the same period to $345.6 million.

Coming to the first six months of 2025, revenues of $836.8 million represented a year-over-year (YoY) growth rate of 14.8%, while net profit declined to $48.3 million from $67.6 million in the year-ago period.

Meanwhile, Alliance Laundry is one of those rare companies that generates cash from its operations consistently. 

In fact, net cash from operating activities increased from $105.1 million in 2022 to $145.5 million in 2024. In the first six months of 2025, the company's net cash from operating activities stood at $50.7 million compared to $36.6 million in the year-ago period. However, the company closed the June quarter with a cash balance of $222.6 million, which was much less than its commercial obligations of $587.7 million, which should be paid in less than a year. Thus, the IPO and its proceeds were necessary for Alliance Laundry to maintain its solvency.

A Market Leader in Laundry

Alliance Laundry is the market leader in the US commercial laundry space with a share of 40%. That is the good news. Now for the bad. The market is only expected to clock a CAGR of 5.2% in the next decade to reach a size of just $8.2 billion. Another report, though a touch optimistic, predicts the market to reach just $10.8 billion by 2032. 

So, this is certainly nothing near the exponential growth rates projected for the high-flying sectors that saw most of the IPOs this year. However, despite all the skepticism around growth, the solid demand for Alliance Laundry's shares reflects that the investing public is willing to pay a premium for a market leader, irrespective of the growth prospects.

Why? Well, apart from its leadership position in the commercial laundry market, some things work in favor of Alliance Laundry.

Alliance Laundry Systems stands out in the laundry equipment sector thanks to its strong brand image, widespread network of distributors, and dedication to high standards, all of which help justify its higher price points and build lasting ties with customers. Notably, the company stresses the importance of build quality, pointing out that upfront capital spending is just a small piece of the puzzle when it comes to the full ownership costs. Those real expenses add up from things like energy and water use, repair and service bills, upkeep, downtime from breakdowns, cleaning needs, and even the detergents required.

Meanwhile, what’s driven Alliance Laundry to the top spot in the market boils down to a few core strengths. Its equipment is built tough for nonstop, demanding use in commercial spots, often lasting 15 to 20 years on average, exactly what operators need for steady performance without constant headaches. Moreover, it rounds out its lineup with everything from front- and top-load washers to dryers, extractors, tunnel-style batch washers, and gear for final touches like pressing or folding.

Also, a big part of the operation relies on its roughly 600 distributors, who handle sales and get products into the hands efficiently. About three-fourths of the revenue comes from the U.S. market at home, while international sales are growing but still play a supporting role.

What Lies Ahead?

Looking ahead, the company’s plans for expansion target bigger, more organized chains of commercial laundries across multiple sites, along with rising interest in premium setups for homes. It’s also pushing digital tools to create reliable, ongoing revenue from services and add-ons.

At the same time, Alliance is ramping up its worldwide push, eyeing markets that promise quicker growth and bigger scale than what’s available stateside. Recent steps include setting up shop in Brazil, China, and Spain to break into promising new regions and spread out its activities. A key move here was snapping up Primus, a solid European maker of laundry machines, back in 2023. This widens its global reach and beefs up the range of tech it offers.

In terms of production, the firm poured more than $4.5 million into its Thai factory in 2024 to ramp up output and keep pace with surging needs across Asia-Pacific. That setup helps it zero in on hot spots like Vietnam, Indonesia, the Philippines, and Cambodia. Down the line, it’s eyeing the launch of 300 fresh laundromat sites in those areas, intending to grab about 70% of the action locally.

To wrap things up, innovation remains a priority, like weaving in easy cashless payments to match what customers want as habits shift around the world.

Final Take

Alliance Laundry presents a unique opportunity to invest in a market leader and in a company that has been around for more than 100 years. This denotes that the company has built reliability and trust among its consumers. Although it must be acknowledged that the runway for growth remains limited in its home market of the United States, Alliance Laundry is making moves to increase its global presence.

Financials are also seeing muted growth, but it is stable. However, the company should keep its debt in check; otherwise, questions regarding its solvency may get louder.