ALARM.COM HOLDINGS INC (ALRM) Stock Fundamental Analysis
NASDAQ:ALRM - Nasdaq - US0116421050 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to ALRM. ALRM was compared to 286 industry peers in the Software industry. ALRM scores excellent on profitability, but there are some minor concerns on its financial health. ALRM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
ALRM had positive earnings in the past year.
In the past year ALRM had a positive cash flow from operations.
In the past 5 years ALRM has always been profitable.
ALRM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ALRM (6.35%) is better than 79.93% of its industry peers.
ALRM has a Return On Equity of 18.12%. This is amongst the best in the industry. ALRM outperforms 86.38% of its industry peers.
ALRM's Return On Invested Capital of 5.16% is fine compared to the rest of the industry. ALRM outperforms 74.91% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ALRM is significantly below the industry average of 12.10%.
The 3 year average ROIC (4.58%) for ALRM is below the current ROIC(5.16%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.35% | ||
| ROE | 18.12% | ||
| ROIC | 5.16% |
ROA(3y)4.7%
ROA(5y)6.87%
ROE(3y)9.9%
ROE(5y)12.28%
ROIC(3y)4.58%
ROIC(5y)6.22%
1.3 Margins
ALRM's Profit Margin of 13.54% is amongst the best of the industry. ALRM outperforms 81.36% of its industry peers.
ALRM's Profit Margin has improved in the last couple of years.
ALRM's Operating Margin of 11.19% is fine compared to the rest of the industry. ALRM outperforms 78.85% of its industry peers.
In the last couple of years the Operating Margin of ALRM has grown nicely.
Looking at the Gross Margin, with a value of 64.95%, ALRM is in line with its industry, outperforming 44.80% of the companies in the same industry.
ALRM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.19% | ||
| PM (TTM) | 13.54% | ||
| GM | 64.95% |
OM growth 3Y-5.95%
OM growth 5Y21.17%
PM growth 3Y-9.99%
PM growth 5Y12.45%
GM growth 3Y-0.04%
GM growth 5Y-0.69%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ALRM is destroying value.
The number of shares outstanding for ALRM has been increased compared to 1 year ago.
ALRM has more shares outstanding than it did 5 years ago.
ALRM has a better debt/assets ratio than last year.
2.2 Solvency
ALRM has an Altman-Z score of 3.08. This indicates that ALRM is financially healthy and has little risk of bankruptcy at the moment.
ALRM has a Altman-Z score (3.08) which is comparable to the rest of the industry.
The Debt to FCF ratio of ALRM is 5.50, which is a neutral value as it means it would take ALRM, 5.50 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 5.50, ALRM perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
ALRM has a Debt/Equity ratio of 1.42. This is a high value indicating a heavy dependency on external financing.
ALRM has a Debt to Equity ratio of 1.42. This is amonst the worse of the industry: ALRM underperforms 82.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.42 | ||
| Debt/FCF | 5.5 | ||
| Altman-Z | 3.08 |
ROIC/WACC0.5
WACC10.26%
2.3 Liquidity
ALRM has a Current Ratio of 8.66. This indicates that ALRM is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of ALRM (8.66) is better than 95.70% of its industry peers.
A Quick Ratio of 8.20 indicates that ALRM has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 8.20, ALRM belongs to the best of the industry, outperforming 95.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 8.66 | ||
| Quick Ratio | 8.2 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 16.58% over the past year.
The Earnings Per Share has been growing by 9.36% on average over the past years. This is quite good.
Looking at the last year, ALRM shows a small growth in Revenue. The Revenue has grown by 6.97% in the last year.
Measured over the past years, ALRM shows a quite strong growth in Revenue. The Revenue has been growing by 15.96% on average per year.
EPS 1Y (TTM)16.58%
EPS 3Y5.53%
EPS 5Y9.36%
EPS Q2Q%10.71%
Revenue 1Y (TTM)6.97%
Revenue growth 3Y12.57%
Revenue growth 5Y15.96%
Sales Q2Q%8.4%
3.2 Future
The Earnings Per Share is expected to grow by 5.29% on average over the next years.
ALRM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.42% yearly.
EPS Next Y9.42%
EPS Next 2Y5.59%
EPS Next 3Y5.29%
EPS Next 5YN/A
Revenue Next Year6.26%
Revenue Next 2Y5.42%
Revenue Next 3Y4.9%
Revenue Next 5Y4.42%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 26.15, the valuation of ALRM can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of ALRM indicates a somewhat cheap valuation: ALRM is cheaper than 75.63% of the companies listed in the same industry.
ALRM's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.46.
A Price/Forward Earnings ratio of 26.16 indicates a quite expensive valuation of ALRM.
74.55% of the companies in the same industry are more expensive than ALRM, based on the Price/Forward Earnings ratio.
ALRM's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 92.56.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.15 | ||
| Fwd PE | 26.16 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ALRM is valued cheaper than 82.80% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ALRM indicates a rather cheap valuation: ALRM is cheaper than 88.53% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.81 | ||
| EV/EBITDA | 21.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ALRM does not grow enough to justify the current Price/Earnings ratio.
ALRM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.78
PEG (5Y)2.8
EPS Next 2Y5.59%
EPS Next 3Y5.29%
5. Dividend
5.1 Amount
ALRM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
ALARM.COM HOLDINGS INC
NASDAQ:ALRM (1/31/2025, 5:20:00 PM)
After market: 60.67 0 (0%)60.67
-0.58 (-0.95%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners100.21%
Inst Owner Change-0.24%
Ins Owners2.68%
Ins Owner Change-0.55%
Market Cap3.00B
Analysts78.67
Price Target75.1 (23.78%)
Short Float %5.02%
Short Ratio5.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.96%
Min EPS beat(2)15.68%
Max EPS beat(2)24.25%
EPS beat(4)4
Avg EPS beat(4)17.2%
Min EPS beat(4)0.48%
Max EPS beat(4)28.39%
EPS beat(8)8
Avg EPS beat(8)24.13%
EPS beat(12)12
Avg EPS beat(12)22.06%
EPS beat(16)16
Avg EPS beat(16)26.92%
Revenue beat(2)2
Avg Revenue beat(2)1.37%
Min Revenue beat(2)0.87%
Max Revenue beat(2)1.88%
Revenue beat(4)2
Avg Revenue beat(4)0.28%
Min Revenue beat(4)-1.37%
Max Revenue beat(4)1.88%
Revenue beat(8)3
Avg Revenue beat(8)-0.25%
Revenue beat(12)7
Avg Revenue beat(12)1.1%
Revenue beat(16)11
Avg Revenue beat(16)3.43%
PT rev (1m)1.38%
PT rev (3m)-3.49%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-10.61%
EPS NY rev (1m)0%
EPS NY rev (3m)7.84%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.73%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.92%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.15 | ||
| Fwd PE | 26.16 | ||
| P/S | 3.25 | ||
| P/FCF | 16.81 | ||
| P/OCF | 15.78 | ||
| P/B | 4.34 | ||
| P/tB | 6.39 | ||
| EV/EBITDA | 21.16 |
EPS(TTM)2.32
EY3.82%
EPS(NY)2.32
Fwd EY3.82%
FCF(TTM)3.61
FCFY5.95%
OCF(TTM)3.84
OCFY6.34%
SpS18.69
BVpS13.97
TBVpS9.5
PEG (NY)2.78
PEG (5Y)2.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.35% | ||
| ROE | 18.12% | ||
| ROCE | 5.72% | ||
| ROIC | 5.16% | ||
| ROICexc | 14.63% | ||
| ROICexgc | 22.38% | ||
| OM | 11.19% | ||
| PM (TTM) | 13.54% | ||
| GM | 64.95% | ||
| FCFM | 19.31% |
ROA(3y)4.7%
ROA(5y)6.87%
ROE(3y)9.9%
ROE(5y)12.28%
ROIC(3y)4.58%
ROIC(5y)6.22%
ROICexc(3y)11.09%
ROICexc(5y)11.78%
ROICexgc(3y)20.79%
ROICexgc(5y)24.28%
ROCE(3y)5.08%
ROCE(5y)6.9%
ROICexcg growth 3Y-15.16%
ROICexcg growth 5Y4.74%
ROICexc growth 3Y-6.71%
ROICexc growth 5Y16.22%
OM growth 3Y-5.95%
OM growth 5Y21.17%
PM growth 3Y-9.99%
PM growth 5Y12.45%
GM growth 3Y-0.04%
GM growth 5Y-0.69%
F-Score7
Asset Turnover0.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.42 | ||
| Debt/FCF | 5.5 | ||
| Debt/EBITDA | 7.32 | ||
| Cap/Depr | 37.68% | ||
| Cap/Sales | 1.26% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 141.6% | ||
| Profit Quality | 142.62% | ||
| Current Ratio | 8.66 | ||
| Quick Ratio | 8.2 | ||
| Altman-Z | 3.08 |
F-Score7
WACC10.26%
ROIC/WACC0.5
Cap/Depr(3y)60.61%
Cap/Depr(5y)68.52%
Cap/Sales(3y)2.35%
Cap/Sales(5y)2.88%
Profit Quality(3y)122.81%
Profit Quality(5y)104.69%
High Growth Momentum
Growth
EPS 1Y (TTM)16.58%
EPS 3Y5.53%
EPS 5Y9.36%
EPS Q2Q%10.71%
EPS Next Y9.42%
EPS Next 2Y5.59%
EPS Next 3Y5.29%
EPS Next 5YN/A
Revenue 1Y (TTM)6.97%
Revenue growth 3Y12.57%
Revenue growth 5Y15.96%
Sales Q2Q%8.4%
Revenue Next Year6.26%
Revenue Next 2Y5.42%
Revenue Next 3Y4.9%
Revenue Next 5Y4.42%
EBIT growth 1Y85.59%
EBIT growth 3Y5.88%
EBIT growth 5Y40.51%
EBIT Next Year42.13%
EBIT Next 3Y18.87%
EBIT Next 5Y16.89%
FCF growth 1Y2158.28%
FCF growth 3Y14.28%
FCF growth 5Y20.17%
OCF growth 1Y347.1%
OCF growth 3Y10.02%
OCF growth 5Y17.5%