ADT, Inc. (ADT) in Ariel Fund Q2 2024

Strategic Focus on Residential Security Enhances Profitability

Apr 15, 2025

Summary

Strong growth in consumer and small business segments.
Margin expansion and improved payback period.
Divestiture of commercial business to focus on residential sector.
Risks include market competition and economic fluctuations.

In the Ariel Fund's Q2 2024 commentary, ADT, Inc. (ADT, Financial) was noted for its positive performance, marked by a top- and bottom-line earnings beat. The company has shown strong growth within the consumer and small business segments, with low attrition and an improving payback period contributing to margin expansion.

"ADT sold its commercial business and is winding down its solar business to focus on profitability in the residential sector and pay down debt. We continue to believe ADT’s industry-leading brand and national presence, coupled with its Google and State Farm strategic partnerships, position it to be a prime beneficiary of growing demand for smart home technologies, including fully monitored residential security." — John Rogers (Trades, Portfolio), Ariel Fund, Q2 2024 Fund Letter

Read full letter at gurufocus John Rogers' Ariel Fund 2nd-Quarter Commentary 2024 Q2 page.

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