Alarm.com (NASDAQ:ALRM – Get Free Report) and Digital Ally Inc./NV (NASDAQ:DGLY – Get Free Report) are both industrials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.
Volatility and Risk
Alarm.com has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500. Comparatively, Digital Ally Inc./NV has a beta of 0.83, suggesting that its share price is 17% less volatile than the S&P 500.
Institutional and Insider Ownership
91.7% of Alarm.com shares are owned by institutional investors. Comparatively, 4.2% of Digital Ally Inc./NV shares are owned by institutional investors. 5.8% of Alarm.com shares are owned by insiders. Comparatively, 0.4% of Digital Ally Inc./NV shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alarm.com | 1 | 2 | 2 | 2 | 2.71 |
| Digital Ally Inc./NV | 0 | 0 | 0 | 1 | 4.00 |
Alarm.com presently has a consensus target price of $64.33, suggesting a potential upside of 22.03%. Given Alarm.com’s higher probable upside, analysts clearly believe Alarm.com is more favorable than Digital Ally Inc./NV.
Profitability
This table compares Alarm.com and Digital Ally Inc./NV’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alarm.com | 13.27% | 13.84% | 5.03% |
| Digital Ally Inc./NV | -59.69% | -538.11% | -38.24% |
Earnings & Valuation
This table compares Alarm.com and Digital Ally Inc./NV”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Alarm.com | $939.83 million | 2.80 | $124.12 million | $2.38 | 22.15 |
| Digital Ally Inc./NV | $19.65 million | 0.17 | -$19.84 million | ($5,042.21) | 0.00 |
Alarm.com has higher revenue and earnings than Digital Ally Inc./NV. Digital Ally Inc./NV is trading at a lower price-to-earnings ratio than Alarm.com, indicating that it is currently the more affordable of the two stocks.
Summary
Alarm.com beats Digital Ally Inc./NV on 14 of the 15 factors compared between the two stocks.
About Alarm.com
Alarm.com Holdings, Inc. provides various Internet of Things (IoT) and solutions for residential, multi-family, small business, and enterprise commercial markets in North America and internationally. The company operates through two segments, Alarm.com and Other. It offers solutions to control and monitor security systems, as well as to IoT devices, including door locks, garage doors, thermostats, and video cameras; and video monitoring and analytics solutions, such as video analytics, escalated events, video doorbells, intelligent integration, live streaming, secure cloud storage, and video alerts. The company also provides scenes, video analytics triggers, thermostat schedules, responsive savings, precision comfort, energy usage monitoring, places feature, whole home water safety, and solar monitoring solutions, as well as heating, ventilation, and air conditioning monitoring services. In addition, it offers demand response programs, commercial grade video, commercial video analytics, access control, cell connectors, enterprise dashboard and multi-site management, energy savings, protection for valuables and inventory, temperature monitoring, and daily safeguard solutions. Further, the company provides a permission-based online portal that provides account management, sales, marketing, training, and support tools; a unified interface that displays key operational and customer experience indicators, including technician performance, system reliability and customer engagement metrics; installation and support services; MobileTech Application and Remote Toolkit; video health reports; smart gateway; AI-powered enhancements to professional monitoring and false alarm reduction; Web services and business intelligence; sales, marketing, and training services; and home builder programs. Additionally, it offers electric utility grid and water management, indoor gunshot detection, and health and wellness and data-rich emergency response solutions. The company was founded in 2000 and is based in Tysons, Virginia.
About Digital Ally Inc./NV
Digital Ally, Inc. produces and sells digital video imaging, storage, and disinfectant and related safety products for use in law enforcement, security, and commercial applications in the United States. It operates through three segments: Video Solutions, Revenue Cycle Management, and Entertainment. The company offers in-car digital video mirror systems for law enforcement; in-car digital video event recorder systems for commercial fleets; a suite of data management web-based tools to assist fleet managers in the organization, archival, and management of videos and telematics information; body-worn digital video systems for law enforcement and private security; and VuLink ecosystem that provides intuitive auto-activation functionality as well as coordination between multiple recording devices. It also provides EVO Web, a web-based software that enables police departments and security agencies to manage digital video evidence quickly and easily; FleetVU Manager, a web-based software for commercial fleet tracking and monitoring; ThermoVu, a non-contact temperature-screening instrument that measures temperature through the wrist and controls entry to facilities when temperature measurements exceed pre-determined parameters; and Shield disinfectants and cleansers, as well as other personal protective equipment and supplies, such as masks, gloves, disposable wipes, and electrostatic sprayer to health care workers and other consumers. In addition, the company offers working capital and back-office services, including insurance and benefit verification, medical treatment documentation and coding, and collections to healthcare organizations; and operates TicketSmarter.com, an online ticketing marketplace for ticket sales, partnerships, and ticket resale services for live events, including concerts, sporting events, theatres, and performing arts. Digital Ally, Inc. was founded in 2004 and is headquartered in Lenexa, Kansas.
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