Alarm.com (ALRM): Valuation Check After New Video Intercom Launch and Everon Commercial Alliance

Alarm.com (ALRM) just rolled out a low cost Video Intercom Mobile Directory and expanded its commercial footprint through a new Everon alliance, developments that quietly strengthen the stock’s long term smart security narrative.

See our latest analysis for Alarm.com Holdings.

Despite these product and partnership wins, Alarm.com Holdings’ share price has drifted lower this year, with a negative year to date share price return and a weak one year total shareholder return. This suggests investors are still weighing how quickly these initiatives will translate into sustained growth.

If this kind of connected security story has your attention, it could be a good moment to explore other smart security and software names via high growth tech and AI stocks and see what else stands out on the numbers.

With shares down this year but trading at a steep discount to analyst targets and intrinsic value estimates, is Alarm.com quietly slipping into undervalued territory, or is the market already accounting for its next leg of growth?

Most Popular Narrative Narrative: 24.5% Undervalued

Against a last close of $51.85, the most followed narrative sees fair value much higher, hinging on steady compounding in both revenue and margins.

The asset light recurring software model, combined with a diversified revenue base (commercial, energy, international now ~30% of SaaS), is contributing to operating leverage and durable margin growth, evidenced by improving EBITDA and FCF generation.

Read the complete narrative.

Want to see what powers this upside case? The narrative leans on disciplined revenue growth, expanding profitability, and a richer earnings multiple than the market is pricing in. Curious how those moving parts add up to the projected fair value and what has to go right financially to get there? Read on and unpack the full set of assumptions behind that upside potential.

Result: Fair Value of $68.71 (UNDERVALUED)

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

However, persistent tariff pressures on hardware, along with intensifying competition from larger tech platforms, could compress margins and slow subscriber growth, challenging this upside case.

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

Build Your Own Alarm.com Holdings Narrative

If this view does not quite align with your own, or you would rather dig into the numbers yourself, you can quickly craft a custom take on Alarm.com in just a few minutes, Do it your way.

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Alarm.com Holdings.

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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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