Alarm.com (ALRM): Assessing Valuation After Launch of New AI-Powered Security Camera

Alarm.com (ALRM) just launched its ADC-V730 spotlight camera, bringing together AI-driven deterrence and streamlined installation. This new product demonstrates Alarm.com’s commitment to strengthening security offerings and improving the service provider experience.

See our latest analysis for Alarm.com Holdings.

Following the ADC-V730 launch, Alarm.com Holdings has seen its share price rebound with a 4.9% one-day gain. However, its momentum has cooled a bit over the past quarter and year, with a 90-day share price return of -15.5% and a 1-year total shareholder return of -19.8%. While new product rollouts showcase the company’s commitment to innovation, investors are watching closely to see if these advancements can reignite stronger long-term returns.

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With shares still trading at a notable discount to analyst price targets, the question now is whether Alarm.com is undervalued enough to offer investors a buying opportunity or if the market has already priced in all the potential upside.

Most Popular Narrative: 27% Undervalued

Alarm.com’s widely followed narrative calculates a fair value that sits well above the current share price, creating a noticeable gap investors can’t ignore. This stage is set by ambitious assumptions about revenue growth and profit margins, and it raises the question of whether the market’s caution is justified.

Strategic investments in its partner network and technology ecosystem (such as minority investments in residential and commercial channel partners and continued expansion of service provider relationships) are enhancing Alarm.com's competitive moat, reducing future customer acquisition costs, and supporting long-term revenue and earnings growth.

Read the complete narrative.

Want to know which projections drive this high valuation? The narrative hinges on future growth, expanding profit margins, and a bold profit multiple. These are details you won’t want to miss. Dive in and see which key financial levers underlie the case for a much higher fair value.

Result: Fair Value of $68.71 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, challenges such as rising hardware tariff costs and increased competition from major tech players could pressure margins and limit Alarm.com's growth story.

Find out about the key risks to this Alarm.com Holdings narrative.

Build Your Own Alarm.com Holdings Narrative

If you want a different perspective or enjoy forming your own conclusions, you can quickly build your own take based on the latest figures. Do it your way

A great starting point for your Alarm.com Holdings research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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