Alarm (ALRM) AI Stock Analysis

• Market Cap: $2.52B
• Dividend Yield: N/A
• Average Volume (3M): 343.45K
• Price to Earnings (P/E): 21.4
• Beta (1Y): 1.13
• Revenue Growth: 7.35%
• EPS Growth: 2.44%
• Country: US
• Employees: 2,020
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.76
• Shares Outstanding: 49,879,680
• 10 Day Avg. Volume: 394,072
• 30 Day Avg. Volume: 343,450
• PEG Ratio: 0.46
• Price to Book (P/B): 4.15
• Price to Sales (P/S): 3.21
• P/FCF Ratio: 15.38
• Enterprise Value/Market Cap: 1.26
• Enterprise Value/Revenue: 3.19
• Enterprise Value/Gross Profit: 4.40
• Enterprise Value/Ebitda: 14.20
• 1Y Price Target: $62.25
• Price Target Upside: 24.13% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 6
• EPS Forecast (FY): 2.45
• Revenue Forecast (FY): $997.66M

• Rating: 69 Neutral
• Price Target: $55.00 ▲(9.67% Upside)

Alarm's overall stock score is driven by strong earnings call performance and solid financial growth, despite high leverage and cash flow concerns. Technical indicators suggest a bearish trend, while valuation remains moderate.

Positive Factors

SaaS Revenue Growth

SaaS revenue growth indicates strong demand for Alarm's subscription services, enhancing recurring revenue streams and long-term financial stability.

EnergyHub Performance

EnergyHub's robust performance and strategic partnerships, like with Tesla, strengthen Alarm's market position in the energy management sector.

New Product Launches

Innovative product launches in AI and video enhance Alarm's competitive edge, driving future growth and market differentiation.

Negative Factors

High Leverage

High leverage increases financial risk, potentially limiting Alarm's ability to invest in growth opportunities and respond to market changes.

Free Cash Flow Decline

A decline in free cash flow growth may constrain Alarm's ability to fund operations and strategic initiatives, impacting long-term financial health.

International Growth Challenges

Lagging international growth suggests potential difficulties in expanding global market presence, which could limit Alarm's overall growth potential.

Alarm Business Overview & Revenue Model

Company Description

Alarm.com Holdings, Inc. provides cloud-based solutions for smart residential and commercial properties in the United States and internationally. It operates in two segments, Alarm.com and Other. The company provides interactive security solutions to control and monitor their security systems, as well as connected security devices, including door locks, motion sensors, door locks, garage doors, Internet of Things, thermostats, and video cameras; and video monitoring solutions, such as video analytics, live streaming, video doorbell, video clips, video alerts, continuous high definition recording, and commercial video surveillance solutions. It also offers intelligent automation and energy management solutions comprising scenes button; smart thermostat schedules; responsive savings; precision comfort; energy usage monitoring; heating, ventilation, and air conditioning monitoring services; whole home water safety solutions; geo-services; and demand response programs. In addition, the company provides commercial solutions, such as daily safeguards, commercial grade video, energy savings, protection for valuables and inventory, temperature monitoring, multi-site management and access control, early identification, simple to use, professionally supported, and easy to maintain. Further, it offers service provider solutions, including a permission-based online portal that offers account management, sales, marketing, training, and support tools; sales, marketing, and training services; and home builder programs, as well as wellness solutions. The company serves residential and commercial subscribers. Alarm.com Holdings, Inc. was founded in 2000 and is based in Tysons, Virginia.

How the Company Makes Money

Alarm generates revenue through multiple streams including the sale of hardware products such as alarm systems and surveillance cameras, subscription fees for monitoring services, and installation charges. The company offers tiered subscription plans that provide customers with options for varying levels of service, which contributes to a steady and recurring revenue model. Additionally, Alarm may engage in partnerships with security service providers and technology firms to enhance its offerings and expand its market reach, further bolstering its earnings.

Alarm Financial Statement Overview

Summary

Alarm demonstrates strong revenue growth and profitability, with improving gross margins. However, the high leverage and declining free cash flow pose potential risks. The company needs to address cash flow challenges to maintain financial stability.

Income Statement

Alarm has shown consistent revenue growth over the years, with a TTM (Trailing-Twelve-Months) revenue growth rate of 1.63%. The gross profit margin has improved to 72.42% in the TTM, indicating strong cost management. However, the net profit margin slightly decreased to 12.92% from the previous year. The EBIT and EBITDA margins are stable, reflecting efficient operations.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 1.29 in the TTM, indicating significant leverage. However, the return on equity remains healthy at 16.48%, suggesting effective use of equity. The equity ratio is moderate, reflecting a balanced asset structure.

Cash Flow

Alarm's free cash flow has declined significantly, with a TTM growth rate of -103.48%, raising concerns about cash generation. The operating cash flow to net income ratio is low at 0.09, indicating potential cash flow challenges. The negative free cash flow to net income ratio further highlights cash flow issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	991.77M	939.83M	881.68M	842.56M	748.97M	618.00M
Gross Profit	718.24M	613.68M	556.52M	499.98M	443.07M	390.57M
EBITDA	222.55M	196.29M	145.38M	102.47M	102.67M	111.16M
Net Income	128.17M	124.12M	81.04M	56.34M	52.26M	77.85M
Balance Sheet
Total Assets	2.12B	2.04B	1.44B	1.33B	1.23B	731.69M
Cash, Cash Equivalents and Short-Term Investments	1.07B	1.22B	696.98M	622.16M	710.62M	253.46M
Total Debt	1.07B	1.06B	526.03M	529.91M	468.27M	157.67M
Total Liabilities	1.24B	1.27B	714.71M	706.53M	605.96M	253.24M
Stockholders Equity	827.19M	726.55M	688.55M	598.86M	613.17M	467.75M
Cash Flow
Free Cash Flow	39.84M	196.28M	121.79M	28.26M	87.73M	81.59M
Operating Cash Flow	58.28M	206.41M	135.97M	56.90M	103.16M	102.08M
Investing Cash Flow	-258.13M	-24.68M	-25.97M	-68.32M	-20.36M	-20.27M
Financing Cash Flow	-19.33M	346.43M	-31.86M	-76.32M	374.37M	52.02M

Alarm Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 50.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALRM, the sentiment is Neutral. The current price of 50.15 is above the 20-day moving average (MA) of 49.99, below the 50-day MA of 52.16, and below the 200-day MA of 55.70, indicating a neutral trend. The MACD of -0.68 indicates Negative momentum. The RSI at 48.18 is Neutral, neither overbought nor oversold. The STOCH value of 79.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ALRM.

Alarm Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALRM	69 Neutral	$2.52B	21.41	16.89%	―	7.35%	2.44%
RNG	63 Neutral	$2.35B	193.50	―	―	5.45%	―
GBTG	62 Neutral	$4.00B	351.34	0.76%	―	5.71%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ALKT	60 Neutral	$2.07B	―	-12.74%	―	30.72%	9.70%
GRND	53 Neutral	$2.80B	―	-171.54%	―	28.97%	-4.18%
SMRT	53 Neutral	$276.23M	―	-25.48%	―	-24.30%	-181.62%

Alarm Corporate Events

Alarm.com Reports Strong Q3 2025 Revenue Growth

Alarm.com Holdings Inc. is a leading platform in the smart property technology sector, providing solutions for security, video surveillance, and energy management to homeowners and businesses globally.

Alarm.com Earnings Call: Strong Growth Amid Challenges

Alarm.com Holdings Inc. recently held an earnings call that revealed a strong financial performance, marked by above-expectation results in revenue and EBITDA. The company showcased significant growth in key business segments, although concerns were raised about tariffs and a weak housing market, which could pose challenges in the future. Nevertheless, strategic investments and a robust cash position provide a buffer against these potential hurdles.

Alarm.com Reports Strong Q2 2025 Earnings Growth

Alarm.com Holdings Inc., a leader in intelligently connected property technology, provides solutions for security, video surveillance, and energy management, serving both residential and commercial markets globally. In its second quarter of 2025, Alarm.com reported a 9.0% increase in SaaS and license revenue, reaching $170 million, and an 8.8% rise in total revenue to $254.3 million compared to the same period in 2024. The company also saw a 5.2% increase in GAAP net income, amounting to $34.2 million, and a 13.0% rise in non-GAAP adjusted EBITDA to $48.4 million. Alarm.com’s recent strategic initiatives include the launch of AI-driven video analytics by its subsidiary OpenEye and a new smart thermostat, enhancing its product offerings. Looking ahead, Alarm.com has raised its full-year guidance, expecting SaaS and license revenue to range between $681.0 million and $681.4 million, and total revenue to reach up to $996.4 million, reflecting a positive outlook based on current management expectations.