ADT INC (ADT) Stock Fundamental Analysis
USA - NYSE:ADT - US00090Q1031 - Common Stock
8.03 USD
-0.23 (-2.78%)
8.03 USD
0 (0%)
Taking everything into account, ADT scores 5 out of 10 in our fundamental rating. ADT was compared to 79 industry peers in the Diversified Consumer Services industry. While ADT belongs to the best of the industry regarding profitability, there are concerns on its financial health. ADT may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year ADT was profitable.
ADT had a positive operating cash flow in the past year.
In multiple years ADT reported negative net income over the last 5 years.
In the past 5 years ADT always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 3.89%, ADT is doing good in the industry, outperforming 63.29% of the companies in the same industry.
With a decent Return On Equity value of 17.00%, ADT is doing good in the industry, outperforming 79.75% of the companies in the same industry.
ADT's Return On Invested Capital of 6.99% is fine compared to the rest of the industry. ADT outperforms 72.15% of its industry peers.
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
The Profit Margin of ADT (12.30%) is better than 73.42% of its industry peers.
ADT has a better Operating Margin (25.78%) than 94.94% of its industry peers.
In the last couple of years the Operating Margin of ADT has grown nicely.
ADT has a better Gross Margin (81.28%) than 93.67% of its industry peers.
In the last couple of years the Gross Margin of ADT has grown nicely.
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ADT is destroying value.
Compared to 1 year ago, ADT has less shares outstanding
The number of shares outstanding for ADT has been increased compared to 5 years ago.
The debt/assets ratio for ADT has been reduced compared to a year ago.
2.2 Solvency
ADT has an Altman-Z score of 0.56. This is a bad value and indicates that ADT is not financially healthy and even has some risk of bankruptcy.
ADT has a Altman-Z score (0.56) which is comparable to the rest of the 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.
The Debt to FCF ratio of ADT (10.79) is better than 62.03% of its industry peers.
A Debt/Equity ratio of 1.85 is on the high side and indicates that ADT has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.85, ADT is doing worse than 70.89% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 10.79 | ||
| Altman-Z | 0.56 |
ROIC/WACC0.91
WACC7.67%
2.3 Liquidity
ADT has a Current Ratio of 0.46. This is a bad value and indicates that ADT is not financially healthy enough and could expect problems in meeting its short term obligations.
ADT has a worse Current ratio (0.46) than 86.08% of its industry peers.
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
The Earnings Per Share has grown by an nice 11.54% over the past year.
ADT shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.53% yearly.
Looking at the last year, ADT shows a small growth in Revenue. The Revenue has grown by 5.28% in the last year.
ADT shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.90% yearly.
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.
ADT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.73% yearly.
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
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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
Based on the Price/Earnings ratio of 9.23, the valuation of ADT can be described as reasonable.
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.
ADT's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.89.
ADT is valuated reasonably with a Price/Forward Earnings ratio of 8.07.
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 | 9.23 | ||
| Fwd PE | 8.07 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ADT indicates a rather cheap valuation: ADT is cheaper than 84.81% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ADT indicates a rather cheap valuation: ADT is cheaper than 89.87% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.22 | ||
| 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.
The decent profitability rating of ADT 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)0.46
PEG (5Y)N/A
EPS Next 2Y16.77%
EPS Next 3Y15.93%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.63%, ADT has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.04, ADT pays a better dividend. On top of this ADT pays more dividend than 96.20% of the companies listed 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%
8.03
-0.23 (-2.78%)
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 Cap6.68B
Revenue(TTM)4.90B
Net Income(TTM)622.00M
Analysts75.56
Price Target9.77 (21.67%)
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 | 9.23 | ||
| Fwd PE | 8.07 | ||
| P/S | 1.32 | ||
| P/FCF | 9.22 | ||
| P/OCF | 3.36 | ||
| P/B | 1.82 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.51 |
EPS(TTM)0.87
EY10.83%
EPS(NY)1
Fwd EY12.4%
FCF(TTM)0.87
FCFY10.85%
OCF(TTM)2.39
OCFY29.8%
SpS6.09
BVpS4.4
TBVpS-7.36
PEG (NY)0.46
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
WACC7.67%
ROIC/WACC0.91
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.