On May 04, 2026, ADT Inc (NYSE: ADT) announced the pricing for its secondary offering, where its largest shareholder, Apollo Global Management, will sell all of its remaining shares, marking a complete exit from the company. The offering involves the sale of 102,000,366 shares of ADT common stock, which represents Apollo's entire remaining stake. This transaction is expected to close on May 5, with Barclays, Citigroup, Morgan Stanley, Goldman Sachs, and BTIG acting as book managers. ADT itself will not sell any shares nor receive any proceeds from this offering.
- GF Valueâ„¢ verdict: Current Price $7.55 vs GF Valueâ„¢ $8.56 = 11.8% undervalued
- GF Scoreâ„¢: 68/100, indicating a moderate potential for long-term returns
- Key financial signal: P/E (TTM) of 10.79x compared to a 5-Year Median P/E of 12.81x
What's Behind the News?
The secondary offering by ADT is significant as it marks the exit of Apollo Global Management, a major shareholder, from the company. This move could be interpreted as a shift in confidence from institutional investors, especially given the historical context where similar secondary offerings involving Apollo have led to an average decline of 4.8% in ADT's stock price the following day. However, ADT is not merely standing still; it has been actively pursuing its capital return strategy, repurchasing approximately 35 million shares for $230 million this year while also focusing on transitioning to its proprietary ADT+ smart home platform.
ADT Inc operates in the Industrials sector, specifically within the Business Services industry. The company provides security, interactive, and smart home solutions to consumer and small business customers across the United States. With a market capitalization of approximately $6.1 billion, ADT is positioned as a significant player in the security services market, leveraging its brand recognition and technological advancements to enhance customer offerings.
Is ADT Overvalued or Undervalued?
According to GuruFocus, ADT's GF Valueâ„¢ is calculated at $8.56, which indicates that the stock is currently undervalued by approximately 11.8% given its current trading price of $7.55. This margin of safety suggests that investors may find value in ADT's stock, especially considering its ongoing share repurchase program and strategic initiatives. The P/E (TTM) ratio stands at 10.79x, which is lower than its 5-year median P/E of 12.81x, further supporting the notion that the stock may be undervalued. For more insights, visit the GF Valueâ„¢ page.
What Does ADT's GF Scoreâ„¢ Tell Us?
The GF Scoreâ„¢ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Scoreâ„¢ values have been found to generate higher long-term returns (backtested 2006-2021).
| GF Scoreâ„¢ | 68 |
| Financial Strength | 3/10 |
| Profitability | 5/10 |
| Growth | 4/10 |
| Valuation | 10/10 |
| Momentum | 4/10 |
ADT's strengths lie in its valuation rank, which is 10/10, indicating that the stock is considered to be modestly undervalued. However, its financial strength is relatively low at 3/10, which could raise concerns about its ability to sustain operations during challenging economic conditions. The profitability rank of 5/10 suggests that while the company is generating profits, there is room for improvement. For further details, visit the ADT stock page.
What Are Insiders Doing with ADT Stock?
In the past three months, there has been no insider buying or selling activity reported for ADT. This lack of insider activity may suggest a neutral sentiment among current insiders regarding the stock's future performance.
What This Means for Investors
Based on the available data, ADT appears to be a modestly undervalued stock with a GF Valueâ„¢ of $8.56 compared to its current price of $7.55. While the stock has potential for appreciation, investors should consider the implications of Apollo's exit and the company's financial strength before making any decisions. For the complete analysis, visit the ADT stock page. You can also use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions
What is ADT's GF Scoreâ„¢?
ADT's GF Scoreâ„¢ is 68/100, indicating a moderate potential for long-term returns based on various financial metrics.
Is ADT overvalued or undervalued?
ADT is currently undervalued, with a GF Valueâ„¢ of $8.56 compared to its current price of $7.55, representing an 11.8% margin of safety.
What is ADT's P/E ratio compared to historical?
ADT's P/E (TTM) ratio is 10.79x, which is lower than its 5-year median P/E of 12.81x, suggesting that the stock may be undervalued relative to its historical performance.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
