ADT INC (ADT) Stock Fundamental Analysis
USA - NYSE:ADT - US00090Q1031 - Common Stock
8.26 USD
-0.12 (-1.43%)
8.26 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to ADT. ADT was compared to 79 industry peers in the Diversified Consumer Services industry. ADT scores excellent on profitability, but there are concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on ADT.
1. Profitability
1.1 Basic Checks
In the past year ADT was profitable.
In the past year ADT had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: ADT reported negative net income in multiple years.
In the past 5 years ADT always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.89%, ADT is in the better half of the industry, outperforming 63.29% of the companies in the same industry.
ADT has a better Return On Equity (17.00%) than 79.75% of its industry peers.
With a decent Return On Invested Capital value of 6.99%, ADT is doing good in the industry, outperforming 72.15% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ADT is below the industry average of 10.04%.
The 3 year average ROIC (5.35%) for ADT is below the current ROIC(6.99%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 17% | ||
| ROIC | 6.99% |
ROA(3y)2.26%
ROA(5y)0.17%
ROE(3y)9.77%
ROE(5y)-0.4%
ROIC(3y)5.35%
ROIC(5y)3.48%
1.3 Margins
ADT has a better Profit Margin (12.30%) than 73.42% of its industry peers.
The Operating Margin of ADT (25.78%) is better than 94.94% of its industry peers.
In the last couple of years the Operating Margin of ADT has grown nicely.
ADT has a Gross Margin of 81.28%. This is amongst the best in the industry. ADT outperforms 93.67% of its industry peers.
ADT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.78% | ||
| PM (TTM) | 12.3% | ||
| GM | 81.28% |
OM growth 3Y192.75%
OM growth 5Y30.56%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.32%
GM growth 5Y2.56%
2. Health
2.1 Basic Checks
ADT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ADT has less shares outstanding than it did 1 year ago.
ADT has more shares outstanding than it did 5 years ago.
ADT has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.56, we must say that ADT is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 0.56, ADT perfoms like the industry average, outperforming 41.77% of the companies in the same industry.
ADT has a debt to FCF ratio of 10.79. This is a negative value and a sign of low solvency as ADT would need 10.79 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 10.79, ADT is in the better half of the industry, outperforming 62.03% of the companies in the same industry.
A Debt/Equity ratio of 1.85 is on the high side and indicates that ADT has dependencies on debt financing.
ADT has a worse Debt to Equity ratio (1.85) than 70.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 10.79 | ||
| Altman-Z | 0.56 |
ROIC/WACC0.97
WACC7.18%
2.3 Liquidity
A Current Ratio of 0.46 indicates that ADT may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.46, ADT is doing worse than 86.08% of the companies in the same industry.
A Quick Ratio of 0.37 indicates that ADT may have some problems paying its short term obligations.
With a Quick ratio value of 0.37, ADT is not doing good in the industry: 87.34% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.46 | ||
| Quick Ratio | 0.37 |
3. Growth
3.1 Past
ADT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.54%, which is quite good.
ADT shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.53% yearly.
The Revenue has been growing slightly by 5.28% in the past year.
The Revenue has been decreasing by -0.90% on average over the past years.
EPS 1Y (TTM)11.54%
EPS 3Y93.99%
EPS 5Y-7.53%
EPS Q2Q%15%
Revenue 1Y (TTM)5.28%
Revenue growth 3Y-2.64%
Revenue growth 5Y-0.9%
Sales Q2Q%4.34%
3.2 Future
ADT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.93% yearly.
Based on estimates for the next years, ADT will show a small growth in Revenue. The Revenue will grow by 4.73% on average per year.
EPS Next Y20.2%
EPS Next 2Y16.77%
EPS Next 3Y15.93%
EPS Next 5YN/A
Revenue Next Year5.43%
Revenue Next 2Y4.91%
Revenue Next 3Y4.73%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 9.49, which indicates a very decent valuation of ADT.
ADT's Price/Earnings ratio is rather cheap when compared to the industry. ADT is cheaper than 84.81% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 25.89. ADT is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 8.30, the valuation of ADT can be described as very reasonable.
92.41% of the companies in the same industry are more expensive than ADT, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of ADT to the average of the S&P500 Index (34.59), we can say ADT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.49 | ||
| Fwd PE | 8.3 |
4.2 Price Multiples
ADT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ADT is cheaper than 84.81% of the companies in the same industry.
89.87% of the companies in the same industry are more expensive than ADT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.48 | ||
| EV/EBITDA | 5.51 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ADT has a very decent profitability rating, which may justify a higher PE ratio.
ADT's earnings are expected to grow with 15.93% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.47
PEG (5Y)N/A
EPS Next 2Y16.77%
EPS Next 3Y15.93%
5. Dividend
5.1 Amount
ADT has a Yearly Dividend Yield of 2.63%.
ADT's Dividend Yield is rather good when compared to the industry average which is at 2.04. ADT pays more dividend than 96.20% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, ADT has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.63% |
5.2 History
The dividend of ADT decreases each year by -23.02%.
ADT has been paying a dividend for at least 10 years, so it has a reliable track record.
ADT has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-23.02%
Div Incr Years1
Div Non Decr Years4
5.3 Sustainability
ADT pays out 31.51% of its income as dividend. This is a sustainable payout ratio.
DP31.51%
EPS Next 2Y16.77%
EPS Next 3Y15.93%
8.26
-0.12 (-1.43%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners77.69%
Inst Owner Change-1.38%
Ins Owners1.32%
Ins Owner Change-5.48%
Market Cap6.87B
Revenue(TTM)4.90B
Net Income(TTM)622.00M
Analysts75.56
Price Target9.77 (18.28%)
Short Float %3.91%
Short Ratio3.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.63% |
Yearly Dividend0.2
Dividend Growth(5Y)-23.02%
DP31.51%
Div Incr Years1
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.59%
Min EPS beat(2)9.32%
Max EPS beat(2)13.86%
EPS beat(4)4
Avg EPS beat(4)11.08%
Min EPS beat(4)5.33%
Max EPS beat(4)15.8%
EPS beat(8)7
Avg EPS beat(8)115.18%
EPS beat(12)10
Avg EPS beat(12)93.1%
EPS beat(16)10
Avg EPS beat(16)40.77%
Revenue beat(2)1
Avg Revenue beat(2)0.36%
Min Revenue beat(2)-0.16%
Max Revenue beat(2)0.88%
Revenue beat(4)3
Avg Revenue beat(4)0.62%
Min Revenue beat(4)-0.16%
Max Revenue beat(4)1.12%
Revenue beat(8)4
Avg Revenue beat(8)-4.61%
Revenue beat(12)5
Avg Revenue beat(12)-5.34%
Revenue beat(16)7
Avg Revenue beat(16)-6.01%
PT rev (1m)0%
PT rev (3m)2.13%
EPS NQ rev (1m)-0.56%
EPS NQ rev (3m)-1.83%
EPS NY rev (1m)-0.4%
EPS NY rev (3m)3.15%
Revenue NQ rev (1m)0.15%
Revenue NQ rev (3m)0.31%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.49 | ||
| Fwd PE | 8.3 | ||
| P/S | 1.36 | ||
| P/FCF | 9.48 | ||
| P/OCF | 3.45 | ||
| P/B | 1.88 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.51 |
EPS(TTM)0.87
EY10.53%
EPS(NY)1
Fwd EY12.05%
FCF(TTM)0.87
FCFY10.54%
OCF(TTM)2.39
OCFY28.97%
SpS6.09
BVpS4.4
TBVpS-7.36
PEG (NY)0.47
PEG (5Y)N/A
Graham Number9.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 17% | ||
| ROCE | 9.37% | ||
| ROIC | 6.99% | ||
| ROICexc | 7.02% | ||
| ROICexgc | 23.78% | ||
| OM | 25.78% | ||
| PM (TTM) | 12.3% | ||
| GM | 81.28% | ||
| FCFM | 14.31% |
ROA(3y)2.26%
ROA(5y)0.17%
ROE(3y)9.77%
ROE(5y)-0.4%
ROIC(3y)5.35%
ROIC(5y)3.48%
ROICexc(3y)5.39%
ROICexc(5y)3.51%
ROICexgc(3y)17.12%
ROICexgc(5y)11.42%
ROCE(3y)7.17%
ROCE(5y)4.67%
ROICexgc growth 3Y161.55%
ROICexgc growth 5Y19.28%
ROICexc growth 3Y188.08%
ROICexc growth 5Y29.78%
OM growth 3Y192.75%
OM growth 5Y30.56%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.32%
GM growth 5Y2.56%
F-Score6
Asset Turnover0.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 10.79 | ||
| Debt/EBITDA | 2.54 | ||
| Cap/Depr | 93.43% | ||
| Cap/Sales | 25.01% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.82% | ||
| Profit Quality | 116.4% | ||
| Current Ratio | 0.46 | ||
| Quick Ratio | 0.37 | ||
| Altman-Z | 0.56 |
F-Score6
WACC7.18%
ROIC/WACC0.97
Cap/Depr(3y)95.22%
Cap/Depr(5y)83.19%
Cap/Sales(3y)26.65%
Cap/Sales(5y)25.39%
Profit Quality(3y)148.73%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)11.54%
EPS 3Y93.99%
EPS 5Y-7.53%
EPS Q2Q%15%
EPS Next Y20.2%
EPS Next 2Y16.77%
EPS Next 3Y15.93%
EPS Next 5YN/A
Revenue 1Y (TTM)5.28%
Revenue growth 3Y-2.64%
Revenue growth 5Y-0.9%
Sales Q2Q%4.34%
Revenue Next Year5.43%
Revenue Next 2Y4.91%
Revenue Next 3Y4.73%
Revenue Next 5YN/A
EBIT growth 1Y13.96%
EBIT growth 3Y185.04%
EBIT growth 5Y29.38%
EBIT Next Year118%
EBIT Next 3Y34.02%
EBIT Next 5Y25.29%
FCF growth 1Y51.56%
FCF growth 3Y76.29%
FCF growth 5Y4.03%
OCF growth 1Y6.67%
OCF growth 3Y4.54%
OCF growth 5Y0.13%
ADT INC / ADT FAQ
Can you provide the ChartMill fundamental rating for ADT INC?
ChartMill assigns a fundamental rating of 5 / 10 to ADT.
What is the valuation status of ADT INC (ADT) stock?
ChartMill assigns a valuation rating of 9 / 10 to ADT INC (ADT). This can be considered as Undervalued.
Can you provide the profitability details for ADT INC?
ADT INC (ADT) has a profitability rating of 7 / 10.
Can you provide the financial health for ADT stock?
The financial health rating of ADT INC (ADT) is 2 / 10.
What is the earnings growth outlook for ADT INC?
The Earnings per Share (EPS) of ADT INC (ADT) is expected to grow by 20.2% in the next year.