Alarm.com S-1 Analysis (NASDAQ: ALRM)

Exchange: NASDAQ Global Select Mkt

Proposed Symbol: ALRM

CEO: Stephen S. Trundle

Offer Amount: $98 mm

No. of Shares to be sold in IPO: 7 mm

No. of Shares Outstanding: 44.85 mm

Price Range: $13-15

Mkt Cap at Midpoint of Proposed range: $627.9 mm

Expected IPO Date: 06/26/15

Description from S-1: “We are the leading platform solution for the connected home. Through our cloud-based services, Alarm.com makes connected home technology broadly accessible to millions of home and business owners. Our multi-tenant software-as-a-service, or SaaS, platform enables home and business owners to intelligently secure their properties and automate and control a broad array of connected devices through a single, intuitive user interface. Our connected home platform currently has more than 2.3 million residential and business subscribers and connects to more than 25 million devices. More than 20 billion data points were generated and processed by those subscribers and devices in the last year alone. This scale of subscribers, devices and data makes Alarm.com the largest connected home platform. Our solutions are delivered through an established network of over 5,000 trusted service providers, who are experts at designing, selling, installing and supporting our solutions. Our technology platform was purpose-built for the entire connected home ecosystem, including the consumers who use it, the service providers who deliver it and the hardware partners whose devices are enabled by the platform. Our solutions are used by both home and business owners, and we refer to this market as the connected home market.”

Underwriters:

  • Lead Underwriter: Goldman, Sachs & Co., Credit Suisse, BofA Merrill Lynch
  • Co Managers: Stifel, Raymond James, William Blair, Imperial Capital

Competitors: Control4, iControl Networks, Honeywell International, Comcast, AT&T, Time Warner Cable, Nest Labs (acquired by Google), DropCam (acquired by Google via Nest Labs), Echelon Corp, Lantronix, Jasper, Freescale, ADT, Crestron, AMX, Elan

Revenue:

  • 2012 = $96.5 mm
  • 2013 = $130.2
  • 2014 = $167.3 mm
  • 3 months ended 03/31/15 = $46 mm
    • 3 months ended 03/31/14 = $36.9 mm

R & D Expenses:

  • 2012 = $8.944 mm
  • 2013 = $13.09 mm
  • 2014 = $23.2 mm
  • 3 months ended 03/31/15 = $4.6 mm
    • 3 months ended 03/31/14 = $7.75 mm

Sales & Marketing Expenses:

  • 2012 = $13.23 mm
  • 2013 = $21.47 mm
  • 2014 = $25.84 mm
  • 3 months ended 03/31/15 = $5.1 mm
    • 3 months ended 03/31/14 = $7.92 mm

Net Income:

  • 2012 = $8.9 mm
  • 2013 = $5.43 mm
  • 2014 = $13.5 mm
  • 3 months ended 03/31/15 = $3.1 mm
    • 3 months ended 03/31/14 = $4.273 mm

No. of Subscribers:

  • 2012 = 1.3 mm
  • 2014 = 1.9 mm
  • 2015 = 2.3 mm

Cash: $39.2 mm

Total Assets: $126.73 mm

Debt: $6.7 mm

Other Notes

  • Based in Vienna, VA
  • Founded in 2000
    • was formed as a division of MicroStrategy in 2000, and spun off as a separate entity in 2009
  • Alarm.com provides cloud based services for remote control, home automation and monitoring services.
  • Services include:
    • interactive security
    • video monitoring
    • energy management
    • home automation
  • Funding Round:
    • Private Equity – $136 mm
      • July 24, 2012
      • Investor = Technology Crossover Ventures
  • Control4 (CTRL) was the first and is so far the only publicly-traded pure-play home automation company
    • CTRL had early success in the public market, and was able to double inside of a week when Google acquired Nest in mid January 2014
    • But CTRL has had a rocky time since that point, as it is now trading at sub $10, and it achieved a high of ~$32 amidst the Nest acquisition news
    • ALRM will not likely be an incredibly hot or “glamorous” IPO (like SHAK, BOX, ETSY, SHOP, or pre-IPO FIT), but will probably be a solid 2-3 month swing trade after it comes public (provided its first day pop is less than 20-30%.
Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s