ADT Stock Drops 50% Since IPO

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.

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.

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. 

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?

Pomerantz Law Firm Announces the Filing of a Class Action against ADT Inc. and Certain Officers – ADT

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 "

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.