ADT Inc. (NYSE: ADT), headquartered in Boca Raton, Florida, is the largest US residential security monitoring company providing monitored intrusion + fire + smoke + medical-alert alarm services + smart-home integration to ~6M+ residential + small-business customers across all 50 states. The company traces its history to 1874 (originally American District Telegraph) and was built across the 20th century through Tyco International ownership + various private-equity cycles. Apollo Global Management took ADT private in 2016 for $7B+ and brought the current ADT Inc. public again via IPO January 2018 at $14/share. Under President & CEO Jim DeVries (since 2018, joined ADT-related entities 2003), FY2025 closes with selected various aggregate revenue ~$5.0-5.2B, adjusted EBITDA ~$2.5-2.7B (50%+ margins), RMR ~$370-390M (the dominant residential-security-monitoring valuation metric), ~6M+ customers (~25-30%+ US monitored-security market share), and ~870M shares outstanding. The first deep-dive — the residential security monitoring subscription franchise — covers ADT's largest US residential-security customer base. Subscription monetization features $35-55+/month average revenue at ~90%+ gross margins via the install-and-monitor business model — ADT (or authorized dealers) install alarm systems + sensors + cameras at upfront cost recovered partly via fees and partly amortized, then generates recurring monthly subscription cash flows for 24/7 central-station monitoring + smart-home + mobile-app services. Economics: ~$2,500-3,500+ Customer Lifetime Value vs ~$1,200-1,800+ Subscriber Acquisition Cost = 1.6-2.0x+ CLTV-to-SAC ratio. Customer-attrition discipline reduced gross attrition from historical ~16-18% to ~12-13% currently via retention programs, CLTV-focused acquisition, and Google + Nest smart-home integration enhancing engagement. Distribution through authorized-dealer network (largest channel, ~200+ dealers) + direct sales force + national-account partnerships. FY2026 catalyst is RMR growth, attrition discipline, CLTV economics, and customer-acquisition pace. Competes with DIY-security alternatives Amazon Ring, Google Nest (now ADT-partnered), SimpliSafe, Vivint (NRG-acquired 2024), plus traditional monitoring Brinks (private), Stanley Black & Decker security, Securitas, Allied Universal. The second deep-dive — the Google + Nest smart-home partnership + State-Farm strategic investment + the deleveraging-and-restructuring thesis — covers ADT's three transformative strategic + capital-structure events. The 2020 Google strategic partnership announced August 2020 included $450M Google Class B investment in ADT at ~$9/share + Nest hardware integration into ADT systems + co-marketing + Google AI/technology capabilities supporting smart-home video-analytics. The 2024 State Farm strategic investment announced February 2024 included $1.2B for ~15% equity stake + strategic partnership combining ADT's monitored-security with State Farm's ~83M+ US homeowners-insurance customer base for co-marketed bundled offerings — strategically logical because monitored security + homeowners insurance are highly complementary. The 2024 Commercial business sale to GTCR for $1.6B (August 2024) divested commercial + fire-and-security to focus on residential + small-business. The deleveraging thesis: ADT's ~5.5-6.0x net leverage is among highest in US large-cap (the dominant balance-sheet overhang); deleveraging glide path involves FCF ~$0.7-0.9B/yr + Commercial-sale $1.6B + State Farm $1.2B proceeds + organic EBITDA growth driving leverage toward ~4-5x by 2026-2027. FY2026 catalyst is Google + Nest commercial scaling, State Farm cross-sell traction (the most exciting near-term partnership catalyst), deleveraging pace, and dividend sustainability. Capital position is highly leveraged: ~5.5-6.0x net leverage, Ba2/BB-area credit ratings, substantial senior secured + senior unsecured debt, $0.22/yr dividend maintained through deleveraging (~2-3% yield), modest opportunistic buybacks de-prioritized, capex (SAC + technology) ~$0.3-0.5B/yr, ~870M shares with Google Class B + State Farm ~15% strategic-investor equity. At ~$7-10 per share, equity value ~$6-9B and EV ~$20-25B, ~7.5-10x EV/adj-EBITDA. Base case is RMR growth + deleveraging + ~10-20% total return; bull case is RMR acceleration + State Farm cross-sell delivery + Google + Nest upsell + faster deleveraging + 10-12x re-rating + 30-50%+ return; bear case is RMR stalls + DIY pressure + slower deleveraging + 6-7x de-rating.

[ADT] ADT Inc Thesis 2026: A Residential Security Monitoring Recurring-Revenue Compounder Leverages The Google Partnership And Deleverages

Key Takeaways

ADT Inc. (NYSE: ADT) is expected to close FY2025 with selected various aggregate total revenue of roughly $5.0-5.2B (combining selected aggregate subscription-monitoring + installation + maintenance revenue), adjusted EBITDA of selected various aggregate ~$2.5-2.7B (margins ~50%+, reflecting the high-margin recurring-monthly-revenue economics of the residential-security-monitoring business model), recurring monthly revenue (RMR) of selected various aggregate ~$370-390M (the dominant metric for residential-security-monitoring valuation), selected various aggregate ~6M+ residential + small-business customers, and selected various aggregate ~870M shares outstanding under President & CEO Jim DeVries (CEO since selected aggregate 2018, longtime ADT executive who took the CEO role following ADT's selected aggregate Apollo-Global-Management-led private-equity ownership + the 2018 IPO).
The first deep-dive — the residential security monitoring subscription franchise — covers ADT's selected various aggregate ~6M+ residential + small-business customer base (the largest US residential-security-monitoring customer base by far — selected aggregate ~25-30%+ market share in selected aggregate US monitored-security), the subscription-monitoring economics (selected aggregate $35-55+/month average subscription revenue with selected aggregate ~90%+ gross margins on the monitoring component — selected aggregate the back-half of the install + monitor business model where ADT incurs selected aggregate upfront installation costs + selected aggregate dealer-acquisition costs in exchange for multi-year subscription cash flows that produce selected aggregate the bulk of value); the customer-attrition discipline (ADT has reduced gross-customer-attrition from selected aggregate ~16-18% historical highs to ~12-13% currently as selected aggregate retention programs + selected aggregate Customer Lifetime Value (CLTV)-focused customer-acquisition have improved); and the selected aggregate dealer + direct channels (ADT distributes through selected aggregate authorized-dealer network + selected aggregate direct-sales force + selected aggregate national-account partnerships); FY2026 catalyst is RMR growth (selected aggregate the dominant metric — RMR has been growing modestly through 2024-2025), customer-attrition discipline, selected aggregate Customer Lifetime Value (CLTV) economics, and selected aggregate new-customer-acquisition pace.
The second deep-dive — the Google + Nest smart-home partnership + State-Farm strategic investment + the deleveraging-and-restructuring thesis — covers ADT's 2020 Google strategic-partnership announcement (selected aggregate $450M Google investment in ADT + selected aggregate Nest hardware integration into ADT systems + selected aggregate co-marketing + Google's selected aggregate technology + selected aggregate AI capabilities supporting ADT's smart-home offerings), the 2024 State-Farm strategic investment (selected aggregate ~$1.2B investment giving State Farm selected aggregate a ~15% equity stake + selected aggregate strategic partnership combining ADT's monitored-security with State Farm's homeowners-insurance customer base for selected aggregate co-marketed offerings), the selected aggregate post-2018-IPO restructurings (ADT has progressively sold + selected aggregate divested non-core businesses including selected aggregate the commercial security business — the 2024 sale of the Commercial business to selected aggregate GTCR for selected aggregate $1.6B — using the proceeds to deleverage + return capital + focus on residential + small-business), and the deleveraging glide path (selected aggregate ADT's high leverage of selected aggregate ~5.5-6.0x net-debt-to-EBITDA has been the dominant balance-sheet overhang; selected aggregate the deleveraging plan involves FCF + Commercial-sale proceeds + selected aggregate State-Farm investment proceeds toward selected aggregate gradual leverage reduction); FY2026 catalyst is Google + Nest integration commercial scaling, State-Farm cross-sell traction, deleveraging pace, and selected aggregate non-residential-divestiture aftermath.
Capital position is highly-leveraged, dividend-paying, deleveraging-focused: net leverage of selected various aggregate ~5.5-6.0x net-debt-to-TTM-adjusted-EBITDA — among the highest in US large-cap-companies, reflecting selected aggregate the post-Apollo private-equity-era capital structure + selected aggregate the multi-decade industry-standard leveraged-balance-sheet model for residential-security-monitoring (the high-RMR-margin recurring-cash-flow economics support selected aggregate higher leverage than typical industrials); selected aggregate substantial senior secured + selected aggregate senior unsecured debt with selected aggregate Ba2/BB-area credit ratings; a regular ~$0.22 per share annual dividend (~$0.055/quarter, ~2-3% yield) that has been maintained selected aggregate through the deleveraging period; selected aggregate modest opportunistic buybacks (selected aggregate currently de-prioritized vs deleveraging); selected various aggregate ~870M shares outstanding (substantial — a function of selected aggregate the post-Apollo capital structure including selected aggregate stock-based compensation dilution + selected aggregate Google + State Farm equity issuances).
FY2026 catalysts: RMR growth durability (the dominant operational metric — selected aggregate continued mid-single-digit-plus RMR growth supports the deleveraging thesis); deleveraging pace (selected aggregate the multi-year glide path toward ~4-5x leverage as FCF + Commercial-sale-proceeds + State-Farm-investment-proceeds are deployed against debt); Google + Nest commercial scaling (selected aggregate whether the strategic partnership produces selected aggregate the new-customer-acquisition + selected aggregate retention + selected aggregate ARPU growth that the 2020 deal envisioned); State-Farm cross-sell traction (selected aggregate the most exciting near-term partnership catalyst — selected aggregate State Farm + ADT bundled offerings could be selected aggregate substantial new-customer-acquisition channels); customer-attrition discipline; dividend sustainability + selected aggregate possible dividend growth as leverage moderates; and selected aggregate post-Commercial-sale strategic-positioning as a more focused residential + small-business operator.

Company Background

ADT Inc. (NYSE: ADT), headquartered in Boca Raton, Florida, is the largest US residential security monitoring company — providing monitored intrusion + fire + smoke + medical-alert alarm services + selected aggregate smart-home integration to selected aggregate ~6M+ residential + small-business customers across all 50 states. The company traces its history to 1874 (selected aggregate one of the oldest US business franchises — originally founded as American District Telegraph for selected aggregate telegraph-message-delivery services — selected aggregate "ADT" stands for American District Telegraph); the modern ADT was built across the 20th century under selected aggregate Tyco International ownership + selected aggregate various private-equity ownership cycles, became publicly traded selected aggregate multiple times (including selected aggregate the 2012 Tyco spin-off as ADT Corporation that was selected aggregate taken private by Apollo Global Management for $7B+ in 2016); the current ADT Inc. was formed when Apollo + selected aggregate the leveraged-buyout investors took the company public again via IPO in January 2018 at selected aggregate $14/share (selected aggregate then a major disappointment as the IPO priced well below expected range + selected aggregate the stock initially performed poorly, reflecting selected aggregate the high-leverage capital structure + selected aggregate competitive concerns in security monitoring). Under President & CEO Jim DeVries (CEO since selected aggregate 2018, joined ADT-related entities in selected aggregate 2003 + rose through selected aggregate operations + selected aggregate field leadership before taking the CEO role around the IPO), the company has selectively transformed the franchise through (a) the 2020 Google strategic partnership ($450M Google investment + Nest hardware integration + selected aggregate AI capabilities), (b) the 2024 sale of the Commercial business to GTCR for $1.6B (selected aggregate divesting the commercial security business to focus on residential + small-business), (c) the 2024 State Farm strategic partnership + equity investment (~$1.2B for selected aggregate ~15% equity + selected aggregate combined-offering co-marketing), and (d) selected aggregate ongoing operational + technology improvements that have reduced customer-attrition + improved Customer Lifetime Value (CLTV) economics. The business model: ADT operates the install-and-monitor recurring-revenue model — selected aggregate ADT (or its authorized dealers) install selected aggregate alarm systems + selected aggregate sensors + selected aggregate cameras + selected aggregate smart-home devices in customer homes at selected aggregate upfront cost (recovered partly via selected aggregate up-front equipment + installation fees, partly amortized over the contract life), then ADT generates recurring monthly subscription revenue for the monitoring service (24/7 central-station monitoring with selected aggregate alarm-dispatch to police/fire/EMS, plus selected aggregate selected smart-home + selected aggregate mobile-app services). Service categories: monitored security (the core), home automation (smart-home device control), professional installation + maintenance, and selected aggregate adjacent home services. Capital structure: highly leveraged (~5.5-6.0x), $0.22/yr dividend, modest buybacks, ~870M shares (Google + State Farm strategic-investor equity stakes). Risks: customer-attrition pressure from DIY-security alternatives (Ring/Nest/SimpliSafe), competitive intensity, deleveraging-pace dependence, residential housing-cycle exposure (new customer acquisition follows home-purchase activity), Google partnership execution, State-Farm cross-sell execution.

The Residential Security Monitoring Subscription Franchise

ADT's first leg is the residential security monitoring subscription franchise — selected various aggregate ~6M+ customers + ~$370-390M RMR (recurring monthly revenue), the franchise-defining business. The customer base: selected aggregate the largest US residential-security-monitoring customer base at selected aggregate ~6M+ customers + selected aggregate ~25-30%+ market share (in monitored security — the professionally installed + professionally monitored category that ADT pioneered + dominates); the customer base spans selected aggregate residential homeowners + selected aggregate small-business customers + selected aggregate apartment renters across all 50 states. The subscription monetization: selected aggregate average subscription revenue of $35-55+/month with selected aggregate ~90%+ gross margins on the monitoring component (selected aggregate the monitoring side of the business is selected aggregate highly profitable once the customer is installed — selected aggregate the central-station operations + selected aggregate customer-service + selected aggregate billing are selected aggregate variable-low-cost given the scale); the install-and-monitor business model captures upfront install + equipment revenue (some of which is selected aggregate amortized over the contract) + multi-year subscription cash flows that produce selected aggregate the bulk of customer-lifetime value. The economics math: selected aggregate ADT's typical customer generates selected aggregate ~$2,500-3,500+ of Customer Lifetime Value (CLTV) after deducting selected aggregate Subscriber Acquisition Cost (SAC) of selected aggregate $1,200-1,800+ — providing selected aggregate 1.6-2.0x+ CLTV-to-SAC ratios that drive selected aggregate the underwriting standard for customer acquisition. Customer-attrition discipline: selected aggregate ADT's gross-customer-attrition has been reduced from historical highs of ~16-18% to ~12-13% currently through (a) selected aggregate retention programs (proactive outreach, contract renewals, churn-prevention discounting), (b) selected aggregate Customer Lifetime Value (CLTV)-focused customer-acquisition (selecting selected aggregate longer-tenured customer profiles + selected aggregate higher-quality dealer originations), and (c) selected aggregate Google + Nest smart-home integration that increases customer engagement + selected aggregate stickiness. Distribution channels: (a) Authorized-dealer network (selected aggregate ~200+ authorized dealers that originate new ADT customers + receive selected aggregate dealer fees) — selected aggregate the largest channel; (b) direct sales force (ADT-employed sales + selected aggregate field-services teams); (c) selected aggregate national-account partnerships (selected aggregate including the State Farm and Google relationships). RMR (recurring monthly revenue): the dominant valuation metric for residential-security-monitoring companies — selected aggregate ADT's ~$370-390M RMR translates to selected aggregate $4.4-4.7B of annual recurring revenue at selected aggregate 12x. FY2025-2026 dynamics: customer base broadly stable-to-modestly-growing, RMR growing low-to-mid-single digits, attrition discipline maintained, selected aggregate Google + State-Farm integration progressing. FY2026 catalyst: RMR growth (mid-single-digit-plus growth supports the deleveraging thesis), customer-attrition discipline (continued attrition reduction enhances CLTV), selected aggregate Customer Lifetime Value (CLTV) economics, and selected aggregate new-customer-acquisition pace via dealer + direct + partnership channels. Risks/competitors: DIY-security alternatives (selected aggregate the major competitive threat — Amazon Ring (Amazon), Google Nest (Alphabet — now selected aggregate ADT-partnered), SimpliSafe (private), Vivint (NRG-acquired), selected aggregate Wyze, selected aggregate Eufy, selected aggregate other DIY smart-home camera + alarm offerings); customer-attrition pressure (selected aggregate the perennial concern); residential housing-cycle exposure (selected aggregate new-customer-acquisition follows home-purchase activity); competitive intensity from selected aggregate Brinks Home Security (private), selected aggregate Stanley Black & Decker (SWK) selected aggregate security division, selected aggregate Securitas (Swedish), selected aggregate Allied Universal (private) in security-monitoring + selected aggregate other adjacencies.

The Google + Nest Smart-Home Partnership + State-Farm Strategic Investment + The Deleveraging-And-Restructuring Thesis

The second deep-dive covers ADT's selected aggregate three transformative strategic + capital-structure events that define the company's go-forward thesis. The 2020 Google strategic partnership: announced August 2020, Google made selected aggregate a $450M Class B investment in ADT at selected aggregate $9/share + ADT + Google entered into selected aggregate a strategic-partnership including (a) Google Nest hardware integration into ADT-monitored systems (Nest cameras + Nest doorbells + Nest thermostats + selected aggregate other Nest products work seamlessly with ADT's monitoring infrastructure + ADT app + dispatch capabilities), (b) co-marketing arrangements (Google promotes ADT to Nest customers + ADT promotes Google products to ADT customers), and (c) selected aggregate Google AI + technology capabilities supporting ADT's selected aggregate next-generation video-analytics + selected aggregate alarm-verification + selected aggregate other smart-home offerings; the partnership has been gradually scaling commercially — selected aggregate Google Nest is now selected aggregate the default smart-home-hardware option for new ADT installations + selected aggregate ADT has selected aggregate launched Trusted Neighbor + selected aggregate selected aggregate smart-home-bundle offerings combining ADT monitoring with Nest hardware. The 2024 State Farm strategic investment + partnership: announced selected aggregate February 2024, State Farm made selected aggregate a $1.2B equity investment in ADT for selected aggregate ~15% equity stake + selected aggregate the two companies announced a strategic-partnership combining ADT's monitored-security with State Farm's homeowners-insurance customer base for selected aggregate co-marketed bundled offerings (selected aggregate State Farm homeowners-insurance customers can selected aggregate add ADT-monitored security at selected aggregate preferential pricing + ADT customers can be selected aggregate cross-marketed State Farm products); the partnership is strategically logical because (a) monitored security + homeowners insurance are highly complementary (insured homeowners are demographically + economically aligned with security-monitoring customers; insurance companies provide premium discounts for monitored homes that pay for selected aggregate security-monitoring), and (b) State Farm's selected aggregate ~83M+ US homeowners-insurance customer base is selected aggregate the largest cross-marketing opportunity in selected aggregate US residential-security history. The partnership is in early commercial scaling — selected aggregate the most exciting near-term catalyst. The 2024 Commercial sale + restructuring: in selected aggregate August 2024, ADT sold its Commercial business segment to GTCR (the private-equity firm) for $1.6B — divesting selected aggregate the commercial + small-business segment + selected aggregate professional-fire-and-security division to focus ADT on residential + small-business. The Commercial-sale proceeds were directed to deleveraging the balance sheet (selected aggregate the principal capital-structure imperative). The deleveraging thesis: ADT's selected aggregate ~5.5-6.0x net-debt-to-EBITDA leverage is among the highest in US large-cap + selected aggregate has been the dominant balance-sheet overhang for years; the deleveraging glide path involves: (a) continued FCF generation ($0.7-0.9B/yr) directed toward debt paydown, (b) deployment of the Commercial-sale proceeds ($1.6B) + State Farm investment proceeds ($1.2B) toward debt reduction, and (c) selected aggregate organic EBITDA growth that lowers leverage ratios. Management has selected aggregate guided to selected aggregate leverage falling toward ~4-5x by selected aggregate 2026-2027. FY2026 catalyst: Google + Nest commercial scaling, State-Farm cross-sell traction (selected aggregate the most exciting near-term partnership catalyst), deleveraging pace, and selected aggregate dividend sustainability + selected aggregate possible dividend growth as leverage moderates. Risks: Google + State-Farm partnership execution (selected aggregate the bundling + co-marketing thesis needs to deliver), deleveraging-pace slower than expected, refinancing-cost risk on selected aggregate maturing debt, and selected aggregate continued DIY-security competitive pressure. Comp set: residential + security monitoring — Brinks Home Security (private), Vivint (NRG-acquired in 2024 for $5.2B), Securitas (Swedish — large global commercial-security comp), Allied Universal (private), Stanley Black & Decker (SWK) security division, G4S (selected aggregate Allied Universal-acquired); DIY-security competitors — Amazon Ring, Google Nest (Alphabet), SimpliSafe (private), Wyze, Eufy (Anker); in selected aggregate residential-services + selected aggregate subscription-businesses with similar economics — Frontdoor (FTDR) home-services-subscription, HomeServe USA, Terminix (formerly TMX, taken private by Rentokil), Rentokil Initial (RTO), Rollins (ROL) pest-control comp.

Capital Position + Balance Sheet

ADT runs a highly-leveraged, dividend-paying, deleveraging-focused balance sheet. Net leverage at selected various aggregate ~5.5-6.0x net-debt-to-TTM-adjusted-EBITDA — among the highest in US large-cap companies, reflecting selected aggregate the post-Apollo private-equity-era capital structure + selected aggregate the multi-decade industry-standard leveraged-balance-sheet model for residential-security-monitoring (the high-RMR-margin recurring-cash-flow economics support higher leverage than typical industrials — selected aggregate ratings agencies tolerate higher leverage ratios for selected aggregate predictable subscription cash flows). Debt structure: selected aggregate substantial senior secured + senior unsecured notes + selected aggregate term loans + revolving credit facility with selected aggregate Ba2/BB-area credit ratings (sub-IG); debt-maturity ladder management has been a continuous focus. Free cash flow: selected various aggregate ~$0.7-0.9B/yr — substantial reflecting the high-margin recurring-revenue economics + selected aggregate moderate capex (~$0.3-0.5B/yr — selected aggregate Subscriber Acquisition Cost + selected aggregate technology + selected aggregate sales-and-marketing-related capex). Capex: selected aggregate $0.3-0.5B/yr — selected aggregate primarily Subscriber Acquisition Cost (the cost of acquiring new customers via dealer fees + selected aggregate direct sales + selected aggregate marketing + equipment + installation) + selected aggregate technology investments. Dividend: selected various aggregate ~$0.22 per share annual ($0.055/quarter), yielding selected various aggregate ~2-3% on the stock — maintained through the deleveraging period (selected aggregate a meaningful capital-return signal even at high leverage). Buybacks: modest opportunistic — currently de-prioritized vs deleveraging. Capital-allocation priorities (in order): (1) deleveraging (the dominant priority), (2) dividend maintenance + selected aggregate modest growth, (3) selective customer-acquisition + technology investment, (4) opportunistic buybacks when capacity exists. Strategic-investor equity: Google holds Class B shares from the 2020 partnership + State Farm holds ~15% equity from the 2024 partnership — providing selected aggregate strategic capital + selected aggregate alignment with major strategic partners. Shares outstanding: selected various aggregate ~870M — substantial, a function of selected aggregate the post-Apollo capital structure + selected aggregate ongoing stock-based-compensation dilution + selected aggregate Google + State Farm equity issuances. The principal balance-sheet considerations are the deleveraging pace (the dominant overhang), FCF generation supporting debt paydown, dividend sustainability at the current level, refinancing costs on selected aggregate maturing debt tranches, and selected aggregate post-Commercial-sale strategic positioning.

Key Core Metrics

Total revenue: selected various aggregate ~$5.0-5.2B FY2025
Adjusted EBITDA: selected various aggregate ~$2.5-2.7B FY2025
Adjusted EBITDA margin: selected various aggregate ~50%+
Recurring monthly revenue (RMR): selected various aggregate ~$370-390M (the dominant metric)
Total residential + small-business customers: ~6M+ (largest US monitored-security customer base)
US monitored-security market share: ~25-30%+
Average subscription revenue per customer: ~$35-55+/month
Monitoring-component gross margin: ~90%+
Gross customer attrition: ~12-13% (down from historical ~16-18%)
Customer Lifetime Value (CLTV): ~$2,500-3,500+
Subscriber Acquisition Cost (SAC): ~$1,200-1,800+
CLTV-to-SAC ratio: ~1.6-2.0x+
2020 Google strategic partnership: $450M Class B investment + Nest hardware integration
2024 State Farm strategic partnership: ~$1.2B for ~15% equity + co-marketing
2024 Commercial sale to GTCR: $1.6B (divested commercial + fire-and-security business)
Distribution channels: authorized dealers (largest) + direct sales + national-account partnerships
Free cash flow: ~$0.7-0.9B/yr
Net debt / TTM adj EBITDA: ~5.5-6.0x (among highest in US large-cap)
Credit rating: Ba2/BB area (sub-IG)
Capex (SAC + technology): ~$0.3-0.5B/yr
Dividend: ~~$0.22/yr (~~$0.055/quarter); ~2-3% yield
Buybacks: modest opportunistic (de-prioritized vs deleveraging)
Shares outstanding: ~870M
Google ownership: Class B shares from 2020 partnership
State Farm ownership: ~15% from 2024 partnership
CEO: Jim DeVries (since 2018; joined ADT 2003)
Headquarters: Boca Raton, Florida
History: 1874 founding as American District Telegraph; selected aggregate Tyco ownership; 2016 Apollo LBO $7B+; 2018 IPO at $14/share

Market Evaluation

At roughly ~$7-10 per share on ~870M shares, ADT carries an equity value of selected various aggregate ~$6-9B and an enterprise value of selected various aggregate ~$20-25B (net debt + selected aggregate strategic-investor equity adjusted), trading on FY2025e adjusted EBITDA of ~$2.5-2.7B at selected various aggregate ~7.5-10x EV/adj-EBITDA and selected various aggregate ~12-20x EPS depending on cycle-positioning — a typical leveraged residential-security multiple reflecting the high leverage + selected aggregate the deleveraging glide path + selected aggregate the dividend yield, with selected aggregate the ~2-3% dividend meaningful + selected aggregate the deleveraging-driven equity-value-rebuild driving the total-return thesis. The comp set: residential security + monitoring — Brinks Home Security (private), Vivint (NRG-acquired 2024 at $5.2B EV); in selected aggregate broader security + commercial-services — Securitas (Swedish), Allied Universal (private), G4S (Allied-acquired); in selected aggregate residential-services with similar economics — Frontdoor (FTDR) home-services-subscription at ~6-8x EV/EBITDA, Rentokil Initial (RTO) at ~13-16x premium pest-control comp, Rollins (ROL) at ~22-28x premium pest-control, Servicemaster (selected aggregate now part of Frontdoor or sold), HomeServe USA; in selected aggregate alarm-monitoring + telematics — selected aggregate few directly-comparable pure-plays. FY2026 base case: RMR growing ~3-5% + customer base broadly stable + attrition discipline maintained + Google + State-Farm partnerships modestly contributing + deleveraging continuing at selected aggregate ~0.5-0.7x leverage reduction per year + EBITDA growing modestly + EPS ~$0.65-0.85 + dividend stable + leverage falling toward ~5.0-5.5x = a ~10-20% total-return year as the deleveraging story plays out. Bull case: RMR growth accelerating to ~5-7%+ + State Farm cross-sell delivers material new-customer-acquisition + Google + Nest integration drives substantial smart-home upsell + ARPU expansion + deleveraging faster than expected + the stock re-rates toward 10-12x EV/EBITDA on premium-recognition + 30-50%+ total return. Bear case: RMR growth stalls + DIY-security competitive pressure accelerates attrition + Google + State Farm fail to deliver + deleveraging-pace slows + refinancing costs hit + the stock de-rates toward 6-7x EV/EBITDA on cycle + execution concerns. The thesis turns on the residential-security pipeline (~6M+ customers + RMR growth + attrition discipline + CLTV economics + new-customer-acquisition pace + competitive position vs DIY alternatives) plus the partnership + deleveraging pipeline (Google + State Farm cross-sell + Commercial-sale-proceeds deleveraging + dividend coverage + post-Commercial-sale strategic positioning) plus Jim DeVries's continued operational + capital-structure execution within the Apollo-legacy + Google + State Farm strategic-investor framework.