Alarm.com HoldingsALRM +3.25%83 Net Margin % is 8.89% as of Mar. 2026, which is 0% below its 10-year median of 8.91. GuruFocus rates ALRM with a GF Score™ of 83/100 and a GF Value™ of $64.87 (Significantly Undervalued). The stock has 2 warning signs investors should review. Among 2,825 Software companies, Alarm.com Holdings ranks better than 80.21% on this metric.
The historical rank and industry rank for Alarm.com Holdings's Net Margin % or its related term are showing as below:
ALRM'
s Net Margin % Range Over the Past 10 Years
Min: 3.89 Med: 8.91 Max: 13.21
Current: 12.36
ALRM's Net Margin % is ranked better than 80.21% of 2825
companies
in the Software industry
Industry Median: 2.54
vs ALRM: 12.36
Alarm.com Holdings (NAS:ALRM) Net Margin % Explanation
Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.
But the long term trend of the net margin is a good indicator of the competitiveness and health of the business.
Alarm.com Holdings Net Margin % Related Terms
Alarm.com Holdings Net Margin % Historical Data
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The historical data trend for Alarm.com Holdings's Net Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Software - Application subindustry, Alarm.com Holdings's Net Margin %, along with its competitors' market caps and Net Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Alarm.com Holdings Net Margin % vs Software Industry
For the Software industry and Technology sector, Alarm.com Holdings's Net Margin % distribution charts can be found below:
* The bar in red indicates where Alarm.com Holdings's Net Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Alarm.com Holdings (ALRM) has a Net Margin % of 8.89% as of Mar. 2026. Net margin is the ratio of total net income to net sales. View historical data on Alarm.com Holdings and its competitors. This is near median its historical median of 8.91. Over the past decade, Alarm.com Holdings' Net Margin % has ranged from 3.89 to 13.21. According to the industry distribution chart, Alarm.com Holdings ranks #559 out of 2825 companies in the Software industry, placing it in the top 19.8%.
Is Alarm.com Holdings' Net Margin % too high?
Alarm.com Holdings' current Net Margin % of 8.89% is near median its 10-year median of 8.91. Over the past 10 years, this metric has ranged from a low of 3.89 to a high of 13.21. The Software industry median Net Margin % is 2.54. Alarm.com Holdings' value of 8.89% is 250% above this industry median. Based on the distribution chart, Alarm.com Holdings ranks #559 out of 2825 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Alarm.com Holdings has a GF Score™ of 83/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Alarm.com Holdings' Net Margin % compare to GRND and VERX?
According to the Software industry distribution chart, Alarm.com Holdings ranks #559 out of 2825 companies for Net Margin %. This places Alarm.com Holdings in the top 20% of its industry — outperforming the majority of peers. The industry median Net Margin % is 2.54. Alarm.com Holdings' value of 8.89% is 250% above this benchmark. Historically, Alarm.com Holdings' own Net Margin % has ranged from 3.89 to 13.21 over the past decade. While the company's 10-year median is 8.91 vs. the industry median of 2.54, Alarm.com Holdings has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Net Margin % for a Software company?
The median Net Margin % among Software companies is 2.54, based on 2,825 companies in the industry. Companies in the top quartile (top 25%) have a Net Margin % significantly above this median, while those in the bottom quartile fall well below. However, Net Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Alarm.com Holdings's current Net Margin % of 8.89% is 250% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Net Margin % mean?
A high Net Margin % can signal that a stock is expensive relative to its fundamentals. Net margin is the ratio of total net income to net sales. View historical data on Alarm.com Holdings and its competitors. For the Software industry, the median Net Margin % is 2.54 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Alarm.com Holdings's current Net Margin % is 8.89%, which is near median its own 10-year median of 8.91. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Alarm.com Holdings stock overvalued right now?
Based on GuruFocus' analysis, Alarm.com Holdings (ALRM) is currently considered Significantly Undervalued. The stock's GF Value™ is $64.87, compared to a current price of $44.47 — trading 31.4% below its estimated fair value. The current Net Margin % is 8.89%, which is near median its 10-year median of 8.91 and 250% above the Software industry median of 2.54. Alarm.com Holdings' overall GF Score™ is 83/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Net Margin % calculated?
Net Margin % is calculated from a company's financial statements. For Alarm.com Holdings (ALRM), the current Net Margin % is 8.89% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Alarm.com Holdings (ALRM) Overvalued in 2026?
Based on GuruFocus' analysis, Alarm.com Holdings stock appears to be undervalued.
The current stock price of $44.47 is trading 31.4% below its estimated GF Value™ of $64.87.
GuruFocus considers Alarm.com Holdings to be Significantly Undervalued.
Key valuation signals for ALRM:
Net Margin %: 8.89% (near median its 10-year median of 8.91)
GF Value™: $64.87 vs. price of $44.47 (31.4% below fair value)
Industry Position: 250% above the Software median (#559 of 2825)
No single metric tells the full story. See the ALRM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Alarm.com Holdings Inc has a cloud-based platform that offers an expansive suite of IoT solutions addressing world-wide opportunities in the residential, multi-family, small business and enterprise commercial markets. It has two reportable segments: Alarm.com & Other. The Alarm.com segment represents the cloud-based Software platforms for intelligently connected property & related solutions. The other segment is focused on researching, developing & offering residential & commercial automation solutions & energy management products & services in adjacent markets. The majority of revenue is from the Alarm.com segment. The platform allows home & business owners to secure their properties and automate & control an array of connected device.
83GF Score
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