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Alarum Technologies Ltd. (IL:ALAR)
:ALAR
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Alarum Technologies
(ALAR)
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Rating:73Outperform
Price Target:
539.00
▲(15.17% Upside)
Alarum Technologies' strong financial performance and strategic investments in AI are significant strengths, positioning the company for future growth. However, technical indicators suggest potential short-term challenges, and the declining margins and increased expenses highlighted in the earnings call present risks that need to be managed.
Alarum Technologies (ALAR) vs. iShares MSCI Israel ETF (EIS)
Market Cap
339.21M
Dividend YieldN/A
Average Volume (3M)402.02K
Price to Earnings (P/E)16.1
Beta (1Y)0.14
Revenue Growth-4.31%
EPS Growth2.30%
CountryIL
Employees68
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)1.50
Shares Outstanding71,684,235
10 Day Avg. Volume238,672
30 Day Avg. Volume402,023
Financial Highlights & Ratios
PEG Ratio-0.08
Price to Book (P/B)2.87
Price to Sales (P/S)2.37
P/FCF Ratio8.59
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering0
Alarum Technologies Business Overview & Revenue Model
Company DescriptionAlarum Technologies Ltd. provides cybersecurity and privacy solutions to consumers and enterprises in Israel, the United States, the Middle East, the United Kingdom, the British Virgin Islands, the Asia Pacific, and internationally. The company operates through three segments: Enterprise Cybersecurity, Enterprise Internet Access, and Consumer Internet Access. It offers iShield, a cybersecurity cloud software that protects users from online threats, including phishing, malware, ransomware, and others; privacy solutions and services, a software solution that uses an encryption protocol which is defined upon the process being used to generate a secured encrypted path and keep the users' data private and safe; and web data collection solution allows organizations to collect vast amounts of web and internet data by simultaneously connecting to the Internet from different IP addresses. It also provides static residential proxy network, rotating residential proxy network, data center proxy network, premium dedicated static residential proxies, and data collection API cloud service, as well as advertising services to third party privacy products. The company offers its products through resellers, distributors, and internet service providers. It serves financial organizations, cyber security companies, industrial and commercial companies, online companies, education institutions, and others. The company was formerly known as Safe-T Group Ltd. and changed its name to Alarum Technologies Ltd. in January 2023. Alarum Technologies Ltd. was founded in 2013 and is headquartered in Tel Aviv-Yafo, Israel.
How the Company Makes MoneyAlarum Technologies generates revenue through a multi-faceted business model that includes subscription-based services, one-time software licenses, and hardware sales. The company primarily earns money from recurring subscription fees for its cloud-based security services, which provide ongoing protection and updates to its clients. Additionally, it sells SIEM software licenses and offers consulting services related to cybersecurity infrastructure and strategy. Alarum has also established significant partnerships with other tech firms and cybersecurity organizations, which enhance its market reach and can contribute to joint revenue opportunities. The company may benefit from performance-based contracts and government contracts that require advanced cybersecurity measures, further solidifying its earnings.
Alarum Technologies Earnings Call Summary
Earnings Call Date:Aug 28, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Dec 02, 2025
Earnings Call Sentiment Positive
Alarum Technologies demonstrated strong financial performance and a promising outlook driven by strategic investments and opportunities in the AI market. However, challenges such as declining margins, increased expenses, and market volatility present hurdles that need careful management.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Alarum Technologies reported second quarter revenue of $8.8 million, net profit of $0.3 million, and adjusted EBITDA of $1 million, all ahead of expectations and in line with upgraded guidance.
Significant Market Opportunity in AI
The company is capitalizing on the demand for data collection to train AI models, partnering with major tech giants and e-commerce companies, including a large-scale project with one of the world's largest online marketplaces in Asia.
Investment in Infrastructure and R&D
Alarum is heavily investing in infrastructure to support new demand and expanding their R&D team to enhance their product portfolio, positioning themselves for long-term growth.
Positive Financial Outlook
Guidance for the third quarter of 2025 anticipates revenue of $12.8 million, representing a 78% year-over-year increase, with an expected adjusted EBITDA of around $1.1 million.
Solid Cash Position
The company maintains a strong balance sheet with cash and liquid investments of approximately $25 million, supporting strategic investments.
Negative Updates
Decline in Gross Margin
The non-IFRS gross margin for Q2 2025 was 63%, down from 78% in Q2 2024, due to strategic reinvestment in operations and lower margins from new large-scale projects.
Increased Operating Expenses
Operating expenses increased to $5.4 million in Q2 2025 from $4.2 million in Q2 2024, primarily due to higher employee salary-related costs and R&D investment.
Volatile Market Conditions
The AI market is described as dynamic and unpredictable, with high volatility impacting long-term visibility and customer demand.
Company Guidance
During the Alarum Technologies conference call for the second quarter of 2025, key financial metrics were discussed alongside future guidance. The company reported second-quarter revenue of $8.8 million, a net profit of $0.3 million, and an adjusted EBITDA of $1 million. The company's non-IFRS gross margin was 63%, down from 78% in the same quarter of the previous year, primarily due to increased investment in infrastructure and R&D to support a new large-scale AI data project. This project is expected to contribute approximately $3 million in revenue per quarter, although it initially bears lower profitability margins. The outlook for the third quarter of 2025 anticipates revenue to range around $12.8 million, representing a projected 78% year-over-year increase. Alarum is focused on long-term growth, investing in its infrastructure and workforce to capitalize on the burgeoning AI market, with cash reserves standing at $25 million as of June 30, 2025.Alarum Technologies Financial Statement Overview
Summary
Alarum Technologies has demonstrated strong financial performance with significant revenue growth, improved profitability margins, and enhanced cash flow metrics. The company's low leverage and strong equity position further contribute to its financial stability.Income Statement
The company has shown significant revenue growth with a notable increase in total revenue from $26.52M in 2023 to $31.82M in 2024, marking a 19.99% growth rate. Gross profit margin improved to 75.12% in 2024, indicating strong cost management. The net profit margin increased to 18.16%, reflecting a turnaround from losses in prior years. EBIT and EBITDA margins also improved substantially, showcasing enhanced operational efficiency.85
Very Positive
Balance Sheet
The debt-to-equity ratio decreased to 0.06, demonstrating low leverage and financial stability. Return on equity (ROE) reached 21.94%, highlighting effective management of shareholder funds. The equity ratio at 75.68% indicates a strong equity position, although the total assets growth has been moderate.75
Positive
Cash Flow
Free cash flow grew by 88.19% to $8.79M, reflecting improved cash generation. The operating cash flow to net income ratio of 1.54 indicates solid cash conversion from profits. The free cash flow to net income ratio is 1.52, further supporting strong cash flow management.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 30.49M | 31.82M | 26.52M | 18.78M | 10.28M | 4.89M |
| Gross Profit | 20.74M | 23.91M | 19.11M | 10.13M | 5.14M | 2.39M |
| EBITDA | 2.44M | 8.31M | 3.60M | -10.53M | -9.70M | -8.03M |
| Net Income | 5.39M | 5.78M | -5.53M | -13.15M | -13.13M | -7.84M |
Balance Sheet | ||||||
| Total Assets | 35.77M | 34.81M | 20.07M | 22.37M | 30.65M | 22.97M |
| Cash, Cash Equivalents and Short-Term Investments | 14.91M | 15.08M | 10.87M | 3.29M | 9.71M | 11.02M |
| Total Debt | 893.00K | 1.59M | 1.99M | 3.05M | 562.00K | 663.00K |
| Total Liabilities | 6.65M | 8.46M | 6.88M | 9.06M | 6.47M | 6.76M |
| Stockholders Equity | 29.13M | 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 | 592.00K | 5.04M | -9.80M | -1.19M |
| Financing Cash Flow | 0.00 | 4.69M | 2.21M | 2.60M | 11.64M | 14.71M |
Alarum Technologies Technical Analysis
Negative
468.00
Price Trends
509.74
Negative
448.73
Positive
376.90
Positive
Market Momentum
-7.18
Positive
44.56
Neutral
37.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:ALAR, the sentiment is Negative. The current price of 468 is below the 20-day moving average (MA) of 499.67, below the 50-day MA of 509.74, and above the 200-day MA of 376.90, indicating a neutral trend. The MACD of -7.18 indicates Positive momentum. The RSI at 44.56 is Neutral, neither overbought nor oversold. The STOCH value of 37.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IL: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
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.