Alarm.com Holdings (ALRM) Could Be 16% Below Fair Value On Options Buzz
Alarm.com Holdings (ALRM) has drawn fresh attention after options activity spiked, with the December 18, 2026 $35 call among the most heavily traded contracts by implied volatility.
Recent trading tells a mixed story for Alarm.com Holdings. The share price closed at US$53.16 after a 90 day share price return of 19.54%, even as the 30 day move is down 7.56% and the 1 year total shareholder return has slipped 1.79%. This points to short term pressure but improving momentum compared with longer term returns.
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Alarm.com Holdings trades at a discount to both internal fair value estimates and analyst targets after a choppy year of returns. Is that gap mispricing cautious execution, or is the market simply pricing the slowing growth story correctly?
Most Popular Narrative: 16% Undervalued
On the most followed narrative, Alarm.com Holdings screens as undervalued, with a fair value of $63 against a last close of $53.16, which puts the recent options activity into sharper focus for anyone tracking the long term story.
The asset-light recurring software model, combined with a diversified revenue base (commercial, energy, international now ~30% of SaaS), is described as contributing to operating leverage and margin performance, as reflected in reported EBITDA and FCF generation.
See why 2 investors see Alarm.com Holdings as 16% undervalued.
Result: Fair Value of $63 (UNDERVALUED)
Still, the Alarm.com Holdings story can be knocked off course if hardware tariffs rise meaningfully, or if slower international uptake keeps recurring software growth below current assumptions.
Find out about the key risks to this Alarm.com Holdings narrative.
Next Steps
Sentiment around Alarm.com Holdings is split, with both concerns and bright spots in view, so consider acting promptly and weighing the full picture for yourself. To see that balance laid out clearly, review the 3 key rewards and 1 important warning sign.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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