Stock fact sheet · data as of
Alarm.com Holdings, Inc. (ALRM): fair value, margin of safety and Wheel Score
Ticker symbol ALRM · Technology · Software - Application · United States · Growth
Is ALRM undervalued?
ALRM closed at 67.96 on 5 Nov 2026, 27% below the GLS average fair value of 92.72 from 8 models (4 of them above the price). That is a moderate margin of safety: the stock passes the "below fair value" Wheel Trade Filter, with room for a bigger discount on the Value part.
The 8 models disagree widely: Lynch gives 17.85 while Payback Time gives 188.04. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
Ranked against every other company we cover, ALRM is clearly faster-growing than it is cheap, so the nightly engine files it under Growth (value score 32, growth score 60, out of 100).
Nine valuation models for ALRM
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 169.73 | +150% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 30.70 | -55% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 54.78 | -19% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 17.85 | -74% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 141.08 | +108% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 113.01 | +66% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 188.04 | +177% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | - | - | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend; no value tonight |
| EPV | 26.56 | -61% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -0.0705 | -100% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 62.50 | -8% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
On financial health ALRM scores 7/9 (Piotroski): most of the nine tests - positive earnings and cash flow, falling debt, rising margins and turnover - are passed, which is the kind of balance sheet a wheel trader is happy to be assigned. The GLS Moat score is 6.0 out of 10: a record that is solid on some of the four parts the score weighs (returns on capital, pricing power, lasting growth, balance sheet) and weaker on others.
Returns on capital are moderate - ROIC 6.7%, ROE 15.6%, ROA 6.1% - with debt at 1.34 times equity and a free-cash-flow yield of 7.1%.
Alarm.com Holdings, Inc. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from License and Service 68%, Hardware and Other Revenue 32% (quarter Q2 FY2026).
Institutional ownership scores 10/10, insider activity 3/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 7 / 9 | ROIC | 6.7% |
|---|---|---|---|
| GLS Moat | 6.0 / 10 | ROE | 15.6% |
| Debt / equity | 1.34 | ROA | 6.1% |
| Free-cash-flow yield | 7.1% | Payout ratio | 0% |
| Institutions | 10 / 10 | Insiders · Congress | 3 · 5 / 10 |
Wheel Score 50: Fair
ALRM scores 50 out of 100 on the Wheel Score (Fair band, 50-69) because it fails filter 1, options that actually trade - options too quiet (622 open interest, 157 a day); and filter 5, can repay its debt - 3.6 years to repay its debt (over 3). A stock must pass all 9 Wheel Trade Filters to reach 70. Otherwise the parts read: value strong, premium strong, moat good, health good, red flags strong, option trading weak, stability fair.
Implied volatility is 38% on the near-the-money contracts 20-60 days out - inside the 35-60% sweet spot the Wheel Score rewards most: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is thin - 622 contracts across every expiry - so fills at a fair price are not guaranteed; a 30-45-day put may not exist at a usable strike.
Volume runs at 580k shares a day on a market cap of $3.3B, with a beta of 0.70 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score rates that fair.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Fails | options too quiet (622 open interest, 157 a day) |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Passes | Trading below the nine-model average fair value (margin of safety above 0) |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Fails | 3.6 years to repay its debt (over 3) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Strong | 27% below fair value | |
| Premium | Strong | implied volatility 38% | |
| Moat | Good | moat 6.0/10 | |
| Health | Good | Piotroski 7/9 | |
| Red Flags | Strong | Red Flags score 92/100 | |
| Option trading | Weak | 157 contracts a day, 622 open interest | |
| Stability | Fair | beta 0.70, $3.3B company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
Alarm.com Holdings, Inc. reports earnings on 5 Nov 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Software - Application
The 12 companies below are the closest to Alarm.com Holdings, Inc. by market cap within the Software - Application industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| FSLY Fastly, Inc. | 21.04 | 17.44 | -21% | 23Weak | $3.4B |
| WIX Wix.com Ltd. | 80.52 | 186.00 | +57% | 40Weak | $3.4B |
| INTA Intapp, Inc. | 45.07 | 45.97 | +2% | 30Weak | $3.5B |
| FRSH Freshworks Inc. | 13.26 | 23.55 | +44% | 82Good | $3.5B |
| AGYS Agilysys, Inc. | 122.64 | 75.97 | -61% | 40Weak | $3.5B |
| NATL NCR Atleos Corporation | 47.37 | 75.43 | +37% | 45Weak | $3.5B |
| BLSH Bullish | 23.13 | 13.11 | -76% | 22Weak | $3.5B |
| IPEU IPE Universal Inc. | 14.00 | 0.0178 | -78395% | 20No options | $3.6B |
| VIA Via Transportation, Inc. | 39.20 | 33.87 | -16% | 30Weak | $3.0B |
| SPSC SPS Commerce, Inc. | 85.24 | 95.20 | +10% | 77Good | $3.0B |
| LIFX Life360, Inc. | 11.82 | 11.11 | -6% | 15No options | $2.9B |
| LIF Life360, Inc. | 48.05 | 29.41 | -63% | 25Weak | $3.9B |
Scan the whole market the same way
A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the top 10 stocks that pass all 9 Wheel Trade Filters, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about ALRM
Is ALRM undervalued right now?
By the GLS models, moderately: at 67.96 the stock trades 27% below the average fair value of 92.72 (data as of 5 Nov 2026).
What is the Wheel Score of ALRM and what does it mean?
ALRM scores 50 out of 100 (Fair) - it fails Wheel Trade Filters 1, 5. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for ALRM?
92.72 per share as of 5 Nov 2026 - the simple average of the 8 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Alarm.com Holdings, Inc. report earnings next?
The next earnings report is due on 5 Nov 2026 (after the close), 0 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does ALRM have listed options, and how liquid are they?
Yes. The nightly snapshot found 66 listed contracts with 622 open interest across all expiries and implied volatility of 38% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.