ADT INC (ADT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ADT - US00090Q1031 - Common Stock
8.25 USD
0 (0%)
8.25 USD
0 (0%)
Taking everything into account, ADT scores 5 out of 10 in our fundamental rating. ADT was compared to 76 industry peers in the Diversified Consumer Services industry. While ADT has a great profitability rating, there are quite some concerns on its financial health. ADT scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
ADT had positive earnings in the past year.
In the past year ADT had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: ADT reported negative net income in multiple years.
In the past 5 years ADT always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of ADT (4.01%) is better than 61.84% of its industry peers.
The Return On Equity of ADT (17.51%) is better than 80.26% of its industry peers.
With a decent Return On Invested Capital value of 6.65%, ADT is doing good in the industry, outperforming 67.11% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ADT is below the industry average of 10.30%.
The last Return On Invested Capital (6.65%) for ADT is above the 3 year average (5.35%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.01% | ||
| ROE | 17.51% | ||
| ROIC | 6.65% |
ROA(3y)2.26%
ROA(5y)0.17%
ROE(3y)9.77%
ROE(5y)-0.4%
ROIC(3y)5.35%
ROIC(5y)3.49%
1.3 Margins
With a decent Profit Margin value of 12.53%, ADT is doing good in the industry, outperforming 75.00% of the companies in the same industry.
Looking at the Operating Margin, with a value of 25.25%, ADT belongs to the top of the industry, outperforming 94.74% of the companies in the same industry.
ADT's Operating Margin has improved in the last couple of years.
ADT has a Gross Margin of 80.92%. This is amongst the best in the industry. ADT outperforms 94.74% of its industry peers.
In the last couple of years the Gross Margin of ADT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.25% | ||
| PM (TTM) | 12.53% | ||
| GM | 80.92% |
OM growth 3Y192.77%
OM growth 5Y30.57%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.32%
GM growth 5Y2.56%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ADT is destroying value.
ADT has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, ADT has more shares outstanding
ADT has a better debt/assets ratio than last year.
2.2 Solvency
ADT has an Altman-Z score of 0.62. This is a bad value and indicates that ADT is not financially healthy and even has some risk of bankruptcy.
ADT has a Altman-Z score (0.62) which is in line with its industry peers.
The Debt to FCF ratio of ADT is 9.92, which is on the high side as it means it would take ADT, 9.92 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 9.92, ADT is in the better half of the industry, outperforming 63.16% of the companies in the same industry.
ADT has a Debt/Equity ratio of 1.99. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of ADT (1.99) is worse than 69.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.99 | ||
| Debt/FCF | 9.92 | ||
| Altman-Z | 0.62 |
ROIC/WACC0.95
WACC7.01%
2.3 Liquidity
ADT has a Current Ratio of 0.67. This is a bad value and indicates that ADT is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.67, ADT is not doing good in the industry: 76.32% of the companies in the same industry are doing better.
ADT has a Quick Ratio of 0.67. This is a bad value and indicates that ADT is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.54, ADT is not doing good in the industry: 78.95% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.54 |
3. Growth
3.1 Past
ADT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.54%, which is quite good.
Measured over the past years, ADT shows a decrease in Earnings Per Share. The EPS has been decreasing by -7.53% on average per year.
The Revenue has been growing slightly by 5.20% in the past year.
ADT shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.90% yearly.
EPS 1Y (TTM)11.54%
EPS 3Y93.99%
EPS 5Y-7.53%
EPS Q2Q%15%
Revenue 1Y (TTM)5.2%
Revenue growth 3Y-2.64%
Revenue growth 5Y-0.9%
Sales Q2Q%4.34%
3.2 Future
ADT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.34% yearly.
Based on estimates for the next years, ADT will show a small growth in Revenue. The Revenue will grow by 4.24% on average per year.
EPS Next Y22%
EPS Next 2Y14.39%
EPS Next 3Y13.34%
EPS Next 5YN/A
Revenue Next Year5.35%
Revenue Next 2Y4.47%
Revenue Next 3Y4.24%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 9.48, the valuation of ADT can be described as very reasonable.
85.53% of the companies in the same industry are more expensive than ADT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.19, ADT is valued rather cheaply.
The Price/Forward Earnings ratio is 8.64, which indicates a very decent valuation of ADT.
Based on the Price/Forward Earnings ratio, ADT is valued cheaper than 92.11% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.92, ADT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.48 | ||
| Fwd PE | 8.64 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ADT is valued cheaply inside the industry as 82.89% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, ADT is valued cheaply inside the industry as 96.05% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.6 | ||
| EV/EBITDA | 5.46 |
4.3 Compensation for Growth
ADT's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of ADT may justify a higher PE ratio.
ADT's earnings are expected to grow with 13.34% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.43
PEG (5Y)N/A
EPS Next 2Y14.39%
EPS Next 3Y13.34%
5. Dividend
5.1 Amount
ADT has a Yearly Dividend Yield of 2.67%.
ADT's Dividend Yield is rather good when compared to the industry average which is at 0.31. ADT pays more dividend than 96.05% of the companies in the same industry.
ADT's Dividend Yield is a higher than the S&P500 average which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
5.2 History
The dividend of ADT decreases each year by -23.00%.
ADT has paid a dividend for at least 10 years, which is a reliable track record.
ADT has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-23%
Div Incr Years1
Div Non Decr Years4
5.3 Sustainability
29.94% of the earnings are spent on dividend by ADT. This is a low number and sustainable payout ratio.
DP29.94%
EPS Next 2Y14.39%
EPS Next 3Y13.34%
8.25
0 (0%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners89.52%
Inst Owner Change-0.01%
Ins Owners1.32%
Ins Owner Change0.04%
Market Cap6.76B
Revenue(TTM)5.11B
Net Income(TTM)640.56M
Analysts75.56
Price Target9.67 (17.21%)
Short Float %4.28%
Short Ratio4.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
Yearly Dividend0.2
Dividend Growth(5Y)-23%
DP29.94%
Div Incr Years1
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.14%
Min EPS beat(2)6.41%
Max EPS beat(2)13.86%
EPS beat(4)4
Avg EPS beat(4)8.73%
Min EPS beat(4)5.33%
Max EPS beat(4)13.86%
EPS beat(8)7
Avg EPS beat(8)76.37%
EPS beat(12)10
Avg EPS beat(12)91.66%
EPS beat(16)11
Avg EPS beat(16)51.99%
Revenue beat(2)0
Avg Revenue beat(2)-0.46%
Min Revenue beat(2)-0.76%
Max Revenue beat(2)-0.16%
Revenue beat(4)2
Avg Revenue beat(4)0.27%
Min Revenue beat(4)-0.76%
Max Revenue beat(4)1.12%
Revenue beat(8)4
Avg Revenue beat(8)-1.87%
Revenue beat(12)5
Avg Revenue beat(12)-3.74%
Revenue beat(16)6
Avg Revenue beat(16)-6.11%
PT rev (1m)-1.04%
PT rev (3m)-1.04%
EPS NQ rev (1m)-0.89%
EPS NQ rev (3m)-1.94%
EPS NY rev (1m)-0.23%
EPS NY rev (3m)1.1%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.98%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.48 | ||
| Fwd PE | 8.64 | ||
| P/S | 1.32 | ||
| P/FCF | 8.6 | ||
| P/OCF | 3.43 | ||
| P/B | 1.85 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.46 |
EPS(TTM)0.87
EY10.55%
EPS(NY)0.96
Fwd EY11.58%
FCF(TTM)0.96
FCFY11.63%
OCF(TTM)2.4
OCFY29.14%
SpS6.24
BVpS4.46
TBVpS-7.43
PEG (NY)0.43
PEG (5Y)N/A
Graham Number9.35
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.01% | ||
| ROE | 17.51% | ||
| ROCE | 8.9% | ||
| ROIC | 6.65% | ||
| ROICexc | 6.68% | ||
| ROICexgc | 20.58% | ||
| OM | 25.25% | ||
| PM (TTM) | 12.53% | ||
| GM | 80.92% | ||
| FCFM | 15.39% |
ROA(3y)2.26%
ROA(5y)0.17%
ROE(3y)9.77%
ROE(5y)-0.4%
ROIC(3y)5.35%
ROIC(5y)3.49%
ROICexc(3y)5.39%
ROICexc(5y)3.51%
ROICexgc(3y)17.14%
ROICexgc(5y)11.43%
ROCE(3y)7.17%
ROCE(5y)4.67%
ROICexgc growth 3Y161.56%
ROICexgc growth 5Y19.28%
ROICexc growth 3Y188.1%
ROICexc growth 5Y29.78%
OM growth 3Y192.77%
OM growth 5Y30.57%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.32%
GM growth 5Y2.56%
F-Score6
Asset Turnover0.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.99 | ||
| Debt/FCF | 9.92 | ||
| Debt/EBITDA | 2.74 | ||
| Cap/Depr | 86.6% | ||
| Cap/Sales | 23.16% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.13% | ||
| Profit Quality | 122.81% | ||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.54 | ||
| Altman-Z | 0.62 |
F-Score6
WACC7.01%
ROIC/WACC0.95
Cap/Depr(3y)95.22%
Cap/Depr(5y)83.19%
Cap/Sales(3y)26.65%
Cap/Sales(5y)25.38%
Profit Quality(3y)148.75%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)11.54%
EPS 3Y93.99%
EPS 5Y-7.53%
EPS Q2Q%15%
EPS Next Y22%
EPS Next 2Y14.39%
EPS Next 3Y13.34%
EPS Next 5YN/A
Revenue 1Y (TTM)5.2%
Revenue growth 3Y-2.64%
Revenue growth 5Y-0.9%
Sales Q2Q%4.34%
Revenue Next Year5.35%
Revenue Next 2Y4.47%
Revenue Next 3Y4.24%
Revenue Next 5YN/A
EBIT growth 1Y7.55%
EBIT growth 3Y185.05%
EBIT growth 5Y29.39%
EBIT Next Year117.2%
EBIT Next 3Y33.03%
EBIT Next 5Y25.29%
FCF growth 1Y60.08%
FCF growth 3Y76.31%
FCF growth 5Y4.03%
OCF growth 1Y8.72%
OCF growth 3Y4.54%
OCF growth 5Y0.13%
ADT INC / ADT FAQ
Can you provide the ChartMill fundamental rating for ADT INC?
ChartMill assigns a fundamental rating of 5 / 10 to ADT.
Can you provide the valuation status for ADT INC?
ChartMill assigns a valuation rating of 9 / 10 to ADT INC (ADT). This can be considered as Undervalued.
How profitable is ADT INC (ADT) stock?
ADT INC (ADT) has a profitability rating of 7 / 10.
How financially healthy is ADT INC?
The financial health rating of ADT INC (ADT) is 2 / 10.
How sustainable is the dividend of ADT INC (ADT) stock?
The dividend rating of ADT INC (ADT) is 5 / 10 and the dividend payout ratio is 29.94%.