Alarm.com HoldingsALRM +2.45%87 ROC (Joel Greenblatt) % is 47.93% as of Mar. 2026, which is 21% below its 10-year median of 60.68. GuruFocus rates ALRM with a GF Score™ of 87/100 and a GF Value™ of $64.99 (Modestly Undervalued). The stock has 2 warning signs investors should review. Among 2,807 Software companies, Alarm.com Holdings ranks better than 66.98% on this metric.
Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits). He defines ROC (Joel Greenblatt) % as EBIT divided by the total of Property, Plant and Equipment and net working capital. Alarm.com Holdings's annualized ROC (Joel Greenblatt) % for the quarter that ended in Mar. 2026 was 47.93%.
The historical rank and industry rank for Alarm.com Holdings's ROC (Joel Greenblatt) % or its related term are showing as below:
ALRM'
s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: 32.96 Med: 60.68 Max: 89.93
Current: 70.43
During the past 13 years, Alarm.com Holdings's highest ROC (Joel Greenblatt) % was 89.93%. The lowest was 32.96%. And the median was 60.68%.
ALRM's ROC (Joel Greenblatt) % is ranked better than 66.98% of 2807
companies
in the Software industry
Industry Median: 19.62
vs ALRM: 70.43
Alarm.com Holdings's 5-Year average Growth Rate of ROC (Joel Greenblatt) % was 11.30% per year.
The way Joel Greenblatt defines Return on Capital is a more accurate measure of how efficiently the company generates returns onthe capital actually invested in the business. EBIT is used instead of net income because the tax and interest payment may be affected by factors other than the core business operation. Intangible assets are not included in the calculation because they don't need to be replaced.
Alarm.com Holdings ROC (Joel Greenblatt) % Related Terms
Alarm.com Holdings ROC (Joel Greenblatt) % Historical Data
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The historical data trend for Alarm.com Holdings's ROC (Joel Greenblatt) % 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.
ALRM vs BRZE, QNT, SPSC: ROC (Joel Greenblatt) % Comparison
For the Software - Application subindustry, Alarm.com Holdings's ROC (Joel Greenblatt) %, along with its competitors' market caps and ROC (Joel Greenblatt) % 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 ROC (Joel Greenblatt) % vs Software Industry
For the Software industry and Technology sector, Alarm.com Holdings's ROC (Joel Greenblatt) % distribution charts can be found below:
* The bar in red indicates where Alarm.com Holdings's ROC (Joel Greenblatt) % falls into.
Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits) . He defines Return on Capital as follows:
EBIT stands for Earnings Before Interest and Taxes.
Fixed Assets are also known as non-current assets. They include the Property, Plant and Equipment that the firm needs in its operation.
GuruFocus calculates net working capital as: (Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Deferred Revenue + Other Current Liabilities). We're trying to account for OPERATING assets and liabilities (part of daily business) when calculating working capital. Cash and marketable securities are considered NON-OPERATING assets and are not included in calculation. We will also back out all interest bearing debt, short term debt and the portion of long term debt that is due in the current period from the current liabilities. This debt will be considered when computing cost of capital and it would be inappropriate to count it twice.
Note:
The EBIT data used here is four times the quarterly (Mar. 2026) EBIT data.
* 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.
What does a ROC (Joel Greenblatt) % of 47.93% mean?
Alarm.com Holdings (ALRM) has a ROC (Joel Greenblatt) % of 47.93% as of Mar. 2026. Joel Greenblatt's return on capital is the ratio of EBIT to average fixed assets and net working capital. View historical data on Alarm.com Holdings and its competitors. This is 21% below median its historical median of 60.68. Over the past decade, Alarm.com Holdings' ROC (Joel Greenblatt) % has ranged from 32.96 to 89.93. According to the industry distribution chart, Alarm.com Holdings ranks #927 out of 2807 companies in the Software industry, placing it in the top 33%.
Is Alarm.com Holdings' ROC (Joel Greenblatt) % too high?
Alarm.com Holdings' current ROC (Joel Greenblatt) % of 47.93% is 21% below median its 10-year median of 60.68. Over the past 10 years, this metric has ranged from a low of 32.96 to a high of 89.93. The Software industry median ROC (Joel Greenblatt) % is 19.62. Alarm.com Holdings' value of 47.93% is 144.3% above this industry median. Based on the distribution chart, Alarm.com Holdings ranks #927 out of 2807 companies in the Software industry, which is above the industry midpoint. Overall, Alarm.com Holdings has a GF Score™ of 87/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Alarm.com Holdings' ROC (Joel Greenblatt) % compare to BRZE and QNT?
According to the Software industry distribution chart, Alarm.com Holdings ranks #927 out of 2807 companies for ROC (Joel Greenblatt) %. This puts Alarm.com Holdings in the upper half of its industry. The industry median ROC (Joel Greenblatt) % is 19.62. Alarm.com Holdings' value of 47.93% is 144.3% above this benchmark. Historically, Alarm.com Holdings' own ROC (Joel Greenblatt) % has ranged from 32.96 to 89.93 over the past decade. While the company's 10-year median is 60.68 vs. the industry median of 19.62, 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 ROC (Joel Greenblatt) % for a Software company?
The median ROC (Joel Greenblatt) % among Software companies is 19.62, based on 2,807 companies in the industry. Companies in the top quartile (top 25%) have a ROC (Joel Greenblatt) % significantly above this median, while those in the bottom quartile fall well below. However, ROC (Joel Greenblatt) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Alarm.com Holdings's current ROC (Joel Greenblatt) % of 47.93% is 144.3% 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 ROC (Joel Greenblatt) % mean?
A high ROC (Joel Greenblatt) % can signal that a stock is expensive relative to its fundamentals. Joel Greenblatt's return on capital is the ratio of EBIT to average fixed assets and net working capital. View historical data on Alarm.com Holdings and its competitors. For the Software industry, the median ROC (Joel Greenblatt) % is 19.62 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Alarm.com Holdings's current ROC (Joel Greenblatt) % is 47.93%, which is 21% below median its own 10-year median of 60.68. 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 Modestly Undervalued. The stock's GF Value™ is $64.99, compared to a current price of $49.69 — trading 23.5% below its estimated fair value. The current ROC (Joel Greenblatt) % is 47.93%, which is 21% below median its 10-year median of 60.68 and 144.3% above the Software industry median of 19.62. Alarm.com Holdings' overall GF Score™ is 87/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC (Joel Greenblatt) % calculated?
ROC (Joel Greenblatt) % is calculated from a company's financial statements. For Alarm.com Holdings (ALRM), the current ROC (Joel Greenblatt) % is 47.93% 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 $49.69 is trading 23.5% below its estimated GF Value™ of $64.99.
GuruFocus considers Alarm.com Holdings to be Modestly Undervalued.
Key valuation signals for ALRM:
ROC (Joel Greenblatt) %: 47.93% (21% below median its 10-year median of 60.68)
GF Value™: $64.99 vs. price of $49.69 (23.5% below fair value)
Industry Position: 144.3% above the Software median (#927 of 2807)
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.
87GF Score
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