ADT (ADT) versus The Competition Financial Comparison

ADT (NYSE:ADT) is one of 41 publicly-traded companies in the “PROTECTION – SFTY” industry, but how does it weigh in compared to its rivals? We will compare ADT to related businesses based on the strength of its profitability, risk, valuation, analyst recommendations, earnings, institutional ownership and dividends.

Insider and Institutional Ownership

87.2% of ADT shares are held by institutional investors. Comparatively, 47.9% of shares of all “PROTECTION – SFTY” companies are held by institutional investors. 2.7% of ADT shares are held by insiders. Comparatively, 18.2% of shares of all “PROTECTION – SFTY” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

ADT has a beta of 1.21, suggesting that its share price is 21% more volatile than the S&P 500. Comparatively, ADT’s rivals have a beta of 8.61, suggesting that their average share price is 761% more volatile than the S&P 500.

Profitability

This table compares ADT and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ADT	11.03%	17.23%	4.07%
ADT Competitors	-19.22%	-74.49%	-1.08%

Valuation and Earnings

This table compares ADT and its rivals gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
ADT	$4.90 billion	$501.05 million	14.59
ADT Competitors	$1.23 billion	$110.42 million	50.87

ADT has higher revenue and earnings than its rivals. ADT is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Ratings

This is a breakdown of current recommendations for ADT and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ADT	0	3	1	0	2.25
ADT Competitors	347	648	1062	62	2.40

ADT currently has a consensus target price of $9.05, suggesting a potential upside of 6.97%. As a group, “PROTECTION – SFTY” companies have a potential upside of 10.14%. Given ADT’s rivals stronger consensus rating and higher possible upside, analysts clearly believe ADT has less favorable growth aspects than its rivals.

Dividends

ADT pays an annual dividend of $0.22 per share and has a dividend yield of 2.6%. ADT pays out 37.9% of its earnings in the form of a dividend. As a group, “PROTECTION – SFTY” companies pay a dividend yield of 1.7% and pay out 51.4% of their earnings in the form of a dividend. ADT has raised its dividend for 1 consecutive years. ADT is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Summary

ADT beats its rivals on 8 of the 15 factors compared.

About ADT

ADT Inc. provides security, interactive, and smart home solutions to residential and small business customers in the United States. It operates through two segments, Consumer and Small Business, and Solar. The company provides burglar and life safety alarms, smart security cameras, smart home automation systems, and video surveillance systems. It primarily offers security designed to detect intrusion, control access, sense movement, smoke, fire, carbon monoxide, flooding, temperature, and other environmental conditions and hazards; and address personal medical emergencies, such as injuries or unanticipated falls. The company also provides automation and smart home solutions that allow customers to use their smart phones, smart phone application, or touchscreen panels in their homes to arm and disarm their security systems; record and view real-time video; and creates customized and automated schedules for connected devices; programs systems to react to defined events; integrates system with third-party connected devices, such as cameras, lights, thermostats, appliances, and garage doors, as well as offers monitoring and maintenance services. In addition, the company offers energy storage solutions, energy efficiency upgrades, and roofing services. It offers its products under the ADT, ADT Pulse, ADT+, and ADT Commercial brand names. The company was formerly known as Prime Security Services Parent, Inc. and changed its name to ADT Inc. in September 2017. ADT Inc. was founded in 1874 and is headquartered in Boca Raton, Florida.