Alarm.com executive sells shares worth over $585k

Alarm.com (NASDAQ:ALRM) Holdings, Inc. (NASDAQ:ALRM) executive Daniel Ramos, who serves as the Chief Legal and Compliance Officer and Senior Vice President of Corporate Operations, recently engaged in significant stock transactions, according to the latest filings with the Securities and Exchange Commission.

On August 23, Ramos sold a total of 9,476 shares of Alarm.com at an average price of $61.81, netting a total of $585,711. The sales were executed in multiple transactions ranging from $61.75 to $62.07 per share. This information is detailed in a footnote of the filing, which also offers to provide full details of the sales upon request.

In addition to the sales, Ramos also acquired 1,250 shares on the same day through an option exercise at a set price of $37.94, totaling $47,425. The footnote associated with this transaction indicates that the shares underlying the option were fully vested and exercisable at the time of the transaction. The remaining shares from the option will continue to vest monthly through April 1, 2025, as long as Ramos remains in service with the company.

Post-transaction, Ramos's direct holdings in Alarm.com common stock decreased to 41,100 shares. The transactions represent a routine but substantial change in the executive's stake in the company, which is a common occurrence among corporate insiders.

Investors and market watchers often monitor such insider transactions for insights into executive confidence and company performance. Alarm.com, a leader in prepackaged software services, continues to be an active player in the technology sector, and these transactions are part of the ongoing financial activities within the company's executive ranks.

In other recent news, Alarm.com Holdings Inc. reported substantial growth in its second quarter of 2024, with SaaS and license revenue reaching $155.9 million and an adjusted EBITDA of $42.8 million. JPMorgan recently adjusted its outlook on Alarm.com, reducing the price target from $70 to $65 while maintaining a neutral rating. Despite a challenging residential security market, the company has balanced lower installation activities with robust customer retention rates and growth from its commercial, international, and EnergyHub initiatives.

Noteworthy recent developments include the completion of a $500 million convertible notes offering and the introduction of generative AI to the service provider support platform. The company's full-year 2024 SaaS and license revenue expectations have been raised to between $626.8 million and $627.2 million, with total revenue estimated to be between $920.8 million and $931.2 million.

While Alarm.com has not seen significant effects from the rollout of ADT's new customer transition to ADT+, concerns about a potential headwind of approximately 200 basis points in 2025 persist. These developments reflect Alarm.com's ongoing commitment to long-term investments and profitable growth, with a focus on larger acquisitions in the IoT space.

InvestingPro Insights

Alarm.com Holdings, Inc. (NASDAQ:ALRM) has shown a mix of financial strengths and market challenges according to recent data. With a market capitalization of $2.93 billion, the company operates at a moderate level of debt and maintains liquid assets that exceed its short-term obligations. This financial stability is reflected in the company's gross profit margin, which stands at a healthy 64.6% for the last twelve months as of Q2 2024.

Despite recent market volatility that has seen the stock price decline over the past month and quarter, Alarm.com's fundamentals exhibit potential for growth. The company's P/E ratio is currently 27.65, which is considered low relative to its near-term earnings growth. This is supported by a PEG ratio of 0.46 for the same period, suggesting that the stock could be undervalued based on expected earnings growth rates. Moreover, the company has been profitable over the last twelve months, with a return on assets of 6.57%, and analysts predict profitability will continue this year.

InvestingPro Tips highlight that Alarm.com is trading at a high EBITDA valuation multiple, which may be of interest to investors looking for companies with robust earnings before interest, taxes, depreciation, and amortization. For those interested in exploring further, there are additional 10 InvestingPro Tips available for Alarm.com on the InvestingPro platform, which can provide deeper insights into the company's valuation and performance.

For more detailed analysis and additional insights, investors and market watchers can visit https://www.investing.com/pro/ALRM.

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