Back to top

Why Alarm.Com (ALRM) Could Beat Earnings Estimates Again

Read MoreHide Full Article

Looking for a stock that might be in a good position to beat earnings at its next report? Consider Alarm.Com Holdings, Inc. (ALRM - Free Report) , a firm in the Security and Safety Services industry, which could be a great candidate for another beat.

This company has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. In fact, in these reports, ALRM has beaten estimates by at least 9.1% in both cases, suggesting it has a nice short-term history of crushing expectations.

Earnings in Focus

Two quarters ago, ALRM expected to post earnings of 10 cents per share, while it actually produced earnings of 13 cents per share, a beat of 30%. Meanwhile, for the most recent quarter, the company looked to deliver earnings of 10 cents per share, when it actually saw earnings of 16 cents per share instead, representing a 60% positive surprise.

ALARM.COM HLDGS Price and EPS Surprise


Thanks in part to this history, recent estimates have been moving higher for Alarm.Com. In fact, the Earnings ESP for ALRM is positive, which is a great sign of a coming beat.

After all, the Zacks Earnings ESP compares the most accurate estimate to the broad consensus, looking to find stocks that have seen big revisions as of late, suggesting that analysts have recently become more bullish on the company’s earnings prospects. This is the case for ALRM, as the firm currently has a Zacks Earnings ESP of 9.09%, so another beat could be around the corner.

This is particularly true when you consider that ALRM has a great Zacks Rank #2 (Buy) which can be a harbinger of outperformance and a signal for a strong earnings profile. You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

When you add this solid Zacks Rank to a positive Earnings ESP, a positive earnings surprise happens nearly 70% of the time, so it seems pretty likely that ALRM could see another beat at its next report, especially if recent trends are any guide.

Zacks' Top Investment Ideas for Long-Term Profit

How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE: Holdings, Inc. (ALRM) - free report >>

More from Zacks Tale of the Tape

You May Like