NYSE:ADT

Stock Analysis Report

Executive Summary

ADT Inc. provides security and automation solutions for homes and businesses in the United States and Canada.


Snowflake Analysis

Fair value with imperfect balance sheet.


Similar Companies

Share Price & News

How has ADT's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ADT's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.4%

ADT

-0.6%

US Commercial Services

2.4%

US Market


1 Year Return

-32.5%

ADT

-17.0%

US Commercial Services

-10.0%

US Market

Return vs Industry: ADT underperformed the US Commercial Services industry which returned -19.7% over the past year.

Return vs Market: ADT underperformed the US Market which returned -13.3% over the past year.


Shareholder returns

ADTIndustryMarket
7 Day1.4%-0.6%2.4%
30 Day-26.0%-22.9%-11.0%
90 Day-35.7%-25.8%-19.4%
1 Year-25.2%-32.5%-14.1%-17.0%-8.1%-10.0%
3 Yearn/a14.5%7.1%17.3%9.6%
5 Yearn/a37.9%23.3%36.1%21.1%

Price Volatility Vs. Market

How volatile is ADT's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is ADT undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ADT ($4.38) is trading below our estimate of fair value ($9.35)

Significantly Below Fair Value: ADT is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ADT is unprofitable, so we can't compare its PE Ratio to the Commercial Services industry average.

PE vs Market: ADT is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ADT's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ADT is good value based on its PB Ratio (1.1x) compared to the US Commercial Services industry average (1.1x).


Next Steps

Future Growth

How is ADT forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

12.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ADT is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: ADT is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: ADT is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: ADT's revenue (2.2% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: ADT's revenue (2.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ADT's Return on Equity is forecast to be high in 3 years time (34.5%)


Next Steps

Past Performance

How has ADT performed over the past 5 years?

-16.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ADT is currently unprofitable.

Growing Profit Margin: ADT is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ADT is unprofitable, and losses have increased over the past 5 years at a rate of -16.5% per year.

Accelerating Growth: Unable to compare ADT's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ADT is unprofitable, making it difficult to compare its past year earnings growth to the Commercial Services industry (2.5%).


Return on Equity

High ROE: ADT has a negative Return on Equity (-13.32%), as it is currently unprofitable.


Next Steps

Financial Health

How is ADT's financial position?


Financial Position Analysis

Short Term Liabilities: ADT's short term assets ($625.5M) do not cover its short term liabilities ($1.1B).

Long Term Liabilities: ADT's short term assets ($625.5M) do not cover its long term liabilities ($11.8B).


Debt to Equity History and Analysis

Debt Level: ADT's debt to equity ratio (304.7%) is considered high.

Reducing Debt: Insufficient data to determine if ADT's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable ADT has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: ADT is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 51.5% per year.


Next Steps

Dividend

What is ADT's current dividend yield, its reliability and sustainability?

3.20%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ADT's dividend (3.2%) is higher than the bottom 25% of dividend payers in the US market (2.01%).

High Dividend: ADT's dividend (3.2%) is low compared to the top 25% of dividend payers in the US market (5.66%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ADT has been paying a dividend for less than 10 years.

Growing Dividend: ADT has only been paying a dividend for 2 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: ADT is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: ADT's dividends in 3 years are forecast to be well covered by earnings (15.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.1yrs

Average management tenure


CEO

Jim DeVries (55yo)

1.33s

Tenure

US$17,942,615

Compensation

Mr. James D. DeVries, also known as Jim, has been the President at ASG Intermediate Holding Corp. since September 2017. Mr. DeVries has been Chief Executive Officer of ADT Inc. since December 1, 2018 and P ...


CEO Compensation Analysis

Compensation vs Market: Jim's total compensation ($USD17.94M) is above average for companies of similar size in the US market ($USD5.69M).

Compensation vs Earnings: Jim's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
James DeVries
CEO, President & Director1.33yrsUS$17.94mno data
Jeffrey Likosar
Executive VP2.08yrsUS$11.62m0.16% $5.5m
Donald Young
Executive VP of Field Operations & Chief Information Officerno dataUS$9.99m0.16% $5.4m
Daniel Bresingham
Executive Vice President of Commercialno dataUS$9.98m0.16% $5.4m
Jamie Rosand Haenggi
Chief Customer Officerno dataUS$8.54m0.14% $4.7m
Robert Kupbens
President and Chief Innovation & Product Officer0.25yrno datano data
James Boyce
President & Chief Business Development Officer0.083yrno data0.015% $501.5k
Zachary Susil
VP, Controller & Chief Accounting Officer1yrno data0.0041% $137.3k
Jason Smith
Senior Vice President of Finance & Investor Relationsno datano datano data
David Smail
Executive VP1.17yrsno datano data

1.1yrs

Average Tenure

51yo

Average Age

Experienced Management: ADT's management team is not considered experienced ( 1.1 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
James DeVries
CEO, President & Director1.33yrsUS$17.94mno data
Marc Becker
Chairmanno datano datano data
Eric Press
Director4.25yrsno datano data
Stephanie Drescher
Director3.25yrsno datano data
Matthew Winter
Independent Director2.08yrsUS$192.75k0.0019% $62.4k
Matthew Nord
Director4.25yrsno datano data
David Ryan
Director4.25yrsno datano data
Reed Rayman
Director4.25yrsno datano data
Tracey Griffin
Independent Director1.42yrsUS$114.40k0.0019% $65.8k
Lee Solomon
Director4.25yrsno datano data

4.3yrs

Average Tenure

48yo

Average Age

Experienced Board: ADT's board of directors are considered experienced (4.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

ADT Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: ADT Inc.
  • Ticker: ADT
  • Exchange: NYSE
  • Founded: 1874
  • Industry: Security and Alarm Services
  • Sector: Commercial Services
  • Market Cap: US$3.372b
  • Shares outstanding: 769.92m
  • Website: https://www.adt.com

Number of Employees


Location

  • ADT Inc.
  • 1501 Yamato Road
  • Boca Raton
  • Florida
  • 33431
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ADTNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 2018
541DB (Deutsche Boerse AG)YesCommon StockDEEURJan 2018

Biography

ADT Inc. provides security and automation solutions for homes and businesses in the United States and Canada. It provides a range of fire detection, fire suppression, video surveillance, and access control systems to residential, commercial, and multi-site customers. The company primarily offers monitored security and automation solutions, including the installation and monitoring of security and premises automation systems designed to detect intrusion, control access, sense movement, smoke, fire, carbon monoxide, flooding, temperature, and other environmental conditions and hazards; and address personal emergencies such as injuries, medical emergencies, or incapacitation. It also provides interactive solutions that allow customers to use their smart phones, tablets, and laptops to arm and disarm their security systems, adjust lighting or thermostat levels, view real-time video of their premises, and program customizable schedules for the management of a range of smart home products. In addition, the company offers professional monitoring of third-party devices by enabling other companies to integrate solutions into its monitoring and billing platform. It provides its products under the ADT, ADT Pulse, Protection 1, ADT Commercial, and Blue by ADT names. As of December 31, 2019, ADT Inc. operated through a network of approximately 200 sales and service offices, 9 underwriter laboratories listed monitoring centers, 13 customer and field support locations, two national sales call centers, and two regional distribution centers. The company was formerly known as Prime Security Services Parent, Inc. and changed its name to ADT Inc. in September 2017. ADT Inc. was founded in 1874 and is headquartered in Boca Raton, Florida. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/07 06:34
End of Day Share Price2020/04/06 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.