***** *** *********** ******, Apollo ***** ** ***** ADT **** *** **** security ******* ********** * in *deal ****** ** $** *******...
“****** *** **** **** with ******* ** *** value ** ** **** to ***. ** *** the $** *** ***** offerat ** ***** ***. Not bad for the industry’s largest player, particularly given ADT’s strong signs of improvement in most of their key performance indicators.” [Emphasis Added]
***, ***'* ********* *** gone **** $** ******* to $*.* ******* *** from ** ***** *** to ** ***** ***.
*** *******, **** ** ADT **** ****** ********* presentation ******* ***** $*** million ***:
*** ** *****'* $*.* billion *********, **** $*** ******* of *** ** ***** valued ** **** **.* times.
***, ** *** ****** argued, *** ************* ** improving, **** ******* *********, shorter ******* *** ********* earnings:
******* ****, *** ***** is ***** ********.
The *** ** *********** ***?
*** *******, **** *********, is **** *** ** essentially **-********* **** ****** on *** *******. **** may ** ****** *** ship ** **** ** possible *** ** ** going ****?
*******, ****** *** **** a ***** ****** ** the ***** *******, ********* ********* ******* **** **** *** rolling *** ***** *** security ******. *** **** ******** ******'* ******** offering, ** **, ** is * ****-*********, ** direct ****** ** ***. On *** ***** ****, Amazon *** **** * track ****** ** **********, the **** ****** ** Amazon ****** ***** ** incumbent's ******** *** ***** valuations ** ****.
***'* ******* *** ******* been ****** **** *** entrants *** **** **** complimentary *** ***-*********** ** their **** ****** ** more **** ** ** homeowners *** ***** *** monitoring ******** *** ******* services ** ******** (*.*., Pulse). *** ** **** end, *** *** ***************.
*** ****** ** ****** severely ************ ** **** is * ****** **** the *** ** *** glory **** ** ******** RMR *** ****** ****.
Comments (24)
Undisclosed Integrator #1
ADT is heading downhill and will continue to head downhill. There are more than a few alarm companies that aren't small but they're not going to grow because they want to stay off the radar. I know of a few small alarm companies putting on thousands of accounts a year. Some selling 45,000 accounts and more every year. These companies stay out of the news and under the radar for their own reasons. The days of real RMR is just getting started.
Consumers are realizing those huge companies like ADT arent who they want to do business with.
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Undisclosed Manufacturer #2
"The days of real RMR is just getting started" what exactly do you mean by this?
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Art Stout
ADT will be taken private again if the stock falls further. I can't predict the price of stocks but in this case I sense a bit of overshoot to the lowside over concerns about Amazon. I suspect the threat is overstated a bit.
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Larry Tracy
Try to sell professional cameras in residential today. Good luck I won't even quote it anymore the consumer will try DIY first. Small commercial is much the same.
Alarms for RESI has to do much more or that market will turn to DIY more than it already has.
In Kansas City monitoring by professional dealers are being advertised at $19.95 a month.
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Undisclosed Distributor #3
How much of this is an RMR problem, and how much of this is an ADT problem?
ADT has a notably bad public image, with a reputation for selling a barely functional product, providing poor service, and using locking customers into long, predatory contracts with unjustifiably high prices.
They've got a 13.7% attrition rate. 13.7%! If I ran an alarm company with more than a 6% attrit rate, I'd lock my doors, turn off the lights, and see if 7-11 needs a shift manager.
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David Morgan
05/20/18 06:48am
John, what’s your sense of how this effects the private sales going on now being that ADT is now valued at 16.3 times current RMR?
Does it give buyers leverage to pay lower multiples?
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Larry Tracy
My bet is it will drive down the multiples of buying companies and accounts. The good ole days of 30 to 50 times are almost over
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Larry Tracy
Once the word gets around and the people who fund these programs start cutting back the high valuations are over. The financial models don't work as account attrition will increase even more.
The ADT dealer program help them and they hurt as well. ADT has no relationship with those customers and the dealers slam stuff in as fast as they can with no regards to quality.
ADT has a good management team and I know Tim pretty well, but they have their hands full. I bet it wasn't his idea to go public when they did. If it can get on the right track he is the guy who can do it.
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Undisclosed #4
Pomerantz Law Firm Announces the Filing of a Class Action against ADT Inc. and Certain Officers – ADT
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Larry Tracy
This is not unusual, there are around a hundred law firms in America that specialize in suing public companies who's stock drops a lot. Been on the receiving end of one of these, insurance will pay and it will go away.
I bet if you look closely the main plantiff owns one share of ADT stock.
As my corporate attorney always said " there is no justice there is just us "
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John Honovich
Here is a bull case for ADT: ADT: There's Hope Yet, which argues that a low stock price, improvements in reducing churn and an expanding commercial business means ADT is a good stock buy at this time.
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