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Alarm.com Holdings (ALRM) Gains As Market Dips: What You Should Know

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Alarm.com Holdings (ALRM - Free Report) closed the most recent trading day at $62.88, moving +0.38% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.79%. Elsewhere, the Dow lost 0.85%, while the tech-heavy Nasdaq lost 1.11%.

Heading into today, shares of the security service company had gained 21.82% over the past month, outpacing the Industrial Products sector's gain of 14.77% and the S&P 500's gain of 13.44% in that time.

Investors will be hoping for strength from ALRM as it approaches its next earnings release, which is expected to be February 26, 2019. On that day, ALRM is projected to report earnings of $0.24 per share, which would represent a year-over-year decline of 7.69%. Meanwhile, our latest consensus estimate is calling for revenue of $99.63 million, up 12.21% from the prior-year quarter.

Any recent changes to analyst estimates for ALRM should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.22% higher within the past month. ALRM is currently sporting a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, ALRM is holding a Forward P/E ratio of 45.35. For comparison, its industry has an average Forward P/E of 14.15, which means ALRM is trading at a premium to the group.

We can also see that ALRM currently has a PEG ratio of 2.66. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Security and Safety Services industry currently had an average PEG ratio of 1.51 as of yesterday's close.

The Security and Safety Services industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 183, which puts it in the bottom 29% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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