Alarum Technologies (ALAR) AI Stock Analysis

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Alarum Technologies

(NASDAQ:ALAR)

69Neutral

Alarum Technologies demonstrates strong financial performance and a strategic focus on data collection, driving record revenues. Despite the positive outlook, technical indicators suggest a bearish trend, and potential revenue growth challenges could impact future performance. The stock's undervaluation presents an opportunity, offset by increased operating costs and evolving industry conditions.

Positive Factors

Customer Expansion

Alarum secured a key win with an existing global Fortune 200 customer expanded to adopt Website Unblocker.

Product Launch

Key roadmap launches like Website Unblocker and AI data collector offer medium-term promise and are essential to Alarum's growth strategy.

Strategic Partnerships

Management is actively engaging in late-stage conversations with large global brands, presenting an opportunity for Alarum to become a key element in AI-related data pipelines.

Negative Factors

Demand Volatility

Alarum's recent challenges are perplexing with softer near-term demand and usage volatility due to websites actively restructuring access in response to AI-driven data scraping needs.

Industry Challenges

Declining revenue growth was chalked up to 'industry challenges' that resulted in lower consumption and more churn this quarter.

Revenue Growth

Sluggish revenue growth was chalked up to certain customers pausing or reducing usage to reassess strategies on the heels of increased website blocking that challenges data collection.

Alarum Technologies (ALAR) vs. S&P 500 (SPY)

Market Cap

$41.69M

Dividend YieldN/A

Average Volume (3M)122.24K

Price to Earnings (P/E)7.6

Beta (1Y)1.99

Revenue Growth20.00%

EPS GrowthN/A

CountryUS

Employees68

SectorTechnology

Sector Strength40

IndustrySoftware - Infrastructure

Share Statistics

EPS (TTM)0.85

Shares Outstanding6,952,588

10 Day Avg. Volume122,328

30 Day Avg. Volume122,244

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)6.71

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$12.00

Price Target Upside110.53% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Alarum Technologies Business Overview & Revenue Model

Company DescriptionAlarum Technologies (ALAR) is a cybersecurity company that specializes in providing advanced security solutions to protect digital assets and sensitive information. The company operates in the cybersecurity sector, offering products and services that include secure web access, data protection, and threat intelligence solutions. Alarum Technologies aims to deliver high-quality security measures that safeguard organizations against cyber threats and data breaches.

How the Company Makes MoneyAlarum Technologies makes money primarily through the sale of its cybersecurity products and services. The company's revenue streams include subscription fees for its cloud-based security solutions, licensing fees for its software products, and consulting fees for offering customized security solutions to businesses. Additionally, Alarum may engage in strategic partnerships with other technology firms to enhance its product offerings and expand its market reach. These diverse revenue channels enable the company to generate consistent income while addressing the growing demand for robust cybersecurity measures.

Alarum Technologies Financial Statement Overview

Summary

Alarum Technologies has shown strong financial performance with significant improvements in profitability, revenue growth, and cash flow. The turnaround in net income, robust gross profit margin, and solid balance sheet with low leverage highlight the company's financial health.

Income Statement

Very Positive

Alarum Technologies has demonstrated strong growth in revenue, increasing by 20% from the previous year. The company turned around its net income from a loss to a profit of $5.78 million, resulting in a net profit margin of 18.2%. The gross profit margin is robust at 75.1%, and both EBIT and EBITDA margins have significantly improved, indicating enhanced operational efficiency.

Balance Sheet

Positive

The company's balance sheet shows a solid equity position with a high equity ratio of 75.7%. The debt-to-equity ratio is low at 0.06, reflecting minimal leverage. Return on equity stands at 21.9%, highlighting effective utilization of equity to generate profits. However, the relatively low total assets compared to industry peers might limit scalability.

Cash Flow

Very Positive

Alarum Technologies has shown remarkable improvement in cash flow, with free cash flow increasing significantly. The operating cash flow to net income ratio of 1.54 indicates strong cash generation relative to earnings. The free cash flow to net income ratio is robust at 1.52, showcasing excellent cash conversion capabilities. Despite past negative cash flows, the company has managed a positive trajectory in recent periods.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
31.56M	31.82M	26.52M	18.78M	10.28M	4.89M
	Gross Profit
23.90M	23.91M	18.81M	10.13M	5.14M	2.39M
	EBIT
8.08M	6.72M	-5.50M	-13.42M	-15.01M	-11.33M
	EBITDA
8.09M	8.31M	-1.64M	-10.53M	-9.70M	-6.42M
	Net Income Common Stockholders
7.01M	5.78M	-5.53M	-13.15M	-13.13M	-7.84M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
21.00K	15.08M	10.87M	3.29M	9.71M	11.02M
	Total Assets
0.00	34.81M	20.07M	22.37M	30.65M	22.97M
	Total Debt
0.00	1.59M	1.99M	3.05M	562.00K	663.00K
	Net Debt
21.00K	-13.49M	-8.89M	-244.00K	-3.27M	-10.35M
	Total Liabilities
0.00	8.46M	6.88M	9.06M	6.47M	6.76M
	Stockholders Equity
1.84M	26.35M	13.18M	13.31M	24.19M	16.22M
Cash Flow		Free Cash Flow
0.00	8.79M	4.67M	-8.11M	-9.49M	-6.75M
	Operating Cash Flow
0.00	8.89M	4.73M	-8.05M	-9.21M	-6.61M
	Investing Cash Flow
0.00	-9.34M	695.00K	5.04M	-9.80M	-1.19M
	Financing Cash Flow
0.00	4.69M	2.21M	2.60M	11.74M	14.71M

Alarum Technologies Technical Analysis

Technical Analysis Sentiment

Negative

Last Price5.70

Price Trends

50DMA

7.67

Negative

100DMA

9.65

Negative

200DMA

14.62

Negative

Market Momentum

MACD

-0.46

Positive

RSI

38.81

Neutral

STOCH

16.72

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALAR, the sentiment is Negative. The current price of 5.7 is below the 20-day moving average (MA) of 6.79, below the 50-day MA of 7.67, and below the 200-day MA of 14.62, indicating a bearish trend. The MACD of -0.46 indicates Positive momentum. The RSI at 38.81 is Neutral, neither overbought nor oversold. The STOCH value of 16.72 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALAR.

Alarum Technologies Risk Analysis

Alarum Technologies disclosed 57 risk factors in its most recent earnings report. Alarum Technologies reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Alarum Technologies Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PANW	78 Outperform	$114.56B	97.75	23.38%	―	13.86%	-46.44%
ZS	74 Outperform	$31.27B	―	-1.21%	―	27.77%	89.39%
CRWD	73 Outperform	$93.70B	721.64	-0.69%	―	29.39%	-119.62%
ALAR	69 Neutral	$41.69M	7.57	29.24%	―	20.00%	―
OKTA	69 Neutral	$17.66B	1,736.01	0.46%	―	15.33%	―
Sector *	57 Neutral	$20.24B	9.51	-13.28%	2.72%	5.43%	-24.54%
NET	55 Neutral	$38.84B	―	-8.71%	―	28.76%	58.13%

* Technology Sector Average

Performance Comparison

ALAR

Alarum Technologies

6.32

-20.06

-76.04%

PANW

Palo Alto Networks

168.27

26.34

18.56%

OKTA

Okta

101.63

0.83

0.82%

Zscaler

195.36

10.58

5.73%

CRWD

CrowdStrike Holdings

368.61

50.81

15.99%

NET

Cloudflare

105.50

9.42

9.80%

Alarum Technologies Earnings Call Summary

Earnings Call Date: Mar 20, 2025 | % Change Since: -29.10% | Next Earnings Date: Jun 3, 2025

Earnings Call Sentiment Neutral

Alarum Technologies demonstrated strong financial growth and strategic execution by focusing on data collection, resulting in record revenues and a solid financial position. However, challenges such as increased operating costs, a decline in gross margin, and anticipated slower revenue growth in the near term present potential hurdles. The company's engagement in AI projects shows promising opportunities, yet the market's evolving nature poses both opportunities and uncertainties.

Highlights

Record Annual Revenue and Growth

2024 annual revenue reached a record high of $31.8 million, a 20% increase from 2023. The data collection portion reached $30.9 million, up 45.2% from $21.3 million in 2023, representing 97% of total revenues.

Shift to Data Collection

Alarum fully executed its strategic vision to focus solely on data collection, with 97% of annual revenue attributed to this segment.

Strong Financial Position

Adjusted EBITDA reached $9.4 million in 2024, up from $5.2 million in 2023. Shareholders' equity doubled to $26.4 million from $13.2 million in 2023, and the cash position increased to $25 million from $10.9 million in 2023.

Initial AI Model Training Projects

In Q4 2024 and Q1 2025, Alarum started initial AI model training projects with new customers, including one of the world's largest corporations.

Lowlights

Decline in Non-IFRS Gross Margin

Non-IFRS gross margin for Q4 2024 was 74.3%, down from 77.2% in Q4 2023, due to strategic enhancements in the IT network.

Increase in Operating Expenses

Q4 2024 operating expenses increased to $5 million from $3.6 million in Q4 2023, primarily due to increased employee salary costs.

Lower Net Profit in Q4 2024

IFRS net profit for Q4 2024 was $400,000, down from $1.7 million in Q4 2023, mainly due to increased operating expenses.

Revenue Growth Challenges

The company anticipates slower revenue growth in Q1 2025, with expected revenues of $7.3 million, plus/minus 3%, due to market adjustments and evolving industry conditions.

Company Guidance

During the Alarum Technologies Fourth Quarter and Full Year 2024 Corporate Update Conference Call, CEO Shachar Daniel highlighted the company's strategic focus on data collection, which resulted in a record annual revenue of $31.8 million, with 97% derived from this segment. Adjusted EBITDA reached $9.4 million, reflecting significant growth and operational profitability. The company also reported a non-IFRS gross margin of 77% for the full year. Looking ahead, Alarum anticipates first-quarter 2025 revenue to be around $7.3 million, with adjusted EBITDA expected between $0.8 million and $1.2 million. Despite short-term volatility due to the evolving landscape between traditional web sources and AI-driven platforms, Alarum is optimistic about long-term growth, driven by increased demand from AI-driven companies for large-scale data extraction solutions. The company's robust cash position, with $25 million in cash and equivalents at the end of 2024, supports ongoing strategic investments.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.