Guardian 8 (GRDH) and ADT (ADT) Critical Analysis

Guardian 8 (OTCMKTS:GRDH) and ADT (NYSE:ADT) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, risk, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Guardian 8 and ADT, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Guardian 8 0 0 0 0 N/A
ADT 0 1 8 0 2.89

ADT has a consensus price target of $14.11, suggesting a potential upside of 75.08%. Given ADT’s higher possible upside, analysts clearly believe ADT is more favorable than Guardian 8.

Profitability

This table compares Guardian 8 and ADT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Guardian 8 N/A N/A N/A
ADT 3.95% -3.76% -0.93%

Institutional and Insider Ownership

0.2% of Guardian 8 shares are held by institutional investors. Comparatively, 99.8% of ADT shares are held by institutional investors. 54.7% of Guardian 8 shares are held by insiders. Comparatively, 1.0% of ADT shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Guardian 8 and ADT’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Guardian 8 N/A N/A N/A N/A N/A
ADT $4.32 billion 1.41 $342.62 million ($0.35) -23.03

ADT has higher revenue and earnings than Guardian 8.

Dividends

ADT pays an annual dividend of $0.14 per share and has a dividend yield of 1.7%. Guardian 8 does not pay a dividend. ADT pays out -40.0% of its earnings in the form of a dividend. ADT has raised its dividend for 5 consecutive years.

Summary

ADT beats Guardian 8 on 8 of the 11 factors compared between the two stocks.

About Guardian 8

Guardian 8 Holdings (G8) is engaged in the design and introduction of a category of personal security devices, enhanced non-lethal (ENL) devices. The Company’s product, the Pro V2, incorporates a layered defensive approach to help security professionals and consumers protect themselves against personal attacks, while capturing images and audio recordings to defend against personal liability. The G8 Pro V2 ENL device allows security professionals with layered defense options for de-escalation and personal protection, command center communication and incident recording. The G8 Pro V2 provides a documentable record of events that result in litigation. The G8 Pro V2 is a visible deterrent to any person who observes security officers on-duty armed with the device. The Company’s subsidiary is Guardian 8 Corporation.

About ADT

ADT Inc. provides security and automation solutions for homes and businesses in the United States and Canada. It provides a range of burglary, video, access control, fire and smoke alarm, and medical alert solutions to residential, commercial, and multi-site customers. The company primarily offers professionally monitored security solutions; and interactive home and business automation solutions that are designed to control access, react to movement, and sense carbon monoxide, flooding, and changes in temperature or other environmental conditions, as well as address personal emergencies, such as injuries, medical emergencies, or incapacitation. It also provides interactive solutions that allow customers to use their smart phones, tablets, and laptops to arm and disarm their security systems, adjust lighting or thermostat levels, view real-time video of their premises, and program customizable schedules for the management of a range of smart home products. In addition, the company offers professional monitoring of third-party devices by enabling other companies to integrate solutions into its monitoring and billing platform. It provides its products under the ADT, ADT Pulse, ADT Canopy, ADT Always There, Protection One, Creating Customers for Life, and ASG Security names. ADT Inc. operates through a network of approximately 200 sales and service offices, 12 underwriter laboratories listed monitoring centers, 7 customer and field support locations, 2 national sales call centers, and 2 regional distribution centers. The company was formerly known as Prime Security Services Parent, Inc. and changed its name to ADT Inc. in September 2017. ADT Inc. was founded in 1874 and is headquartered in Boca Raton, Florida.

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