Arlo Technologies, Inc. (ARLO) Fundamental Analysis: Bull vs. Bear Case

ARLO

Arlo Technologies, Inc.

Fundamental data last updated:June 4, 2026

We may earn a commission from partner links. This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate.

company profile

SECTOR

Industrials

industry

Security & Protection Services

Exchange

NYSE

County of HQ

US

Next Earnings Date

08/06/2026

Business Summary

Arlo Technologies, Inc., together with its subsidiaries, provides a cloud-based platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific regions. It combines an intelligent cloud infrastructure and mobile app with various smart connected devices. The company offers Arlo essential indoor camera; Arlo Go 2 LTE/Wi-Fi security camera; Arlo Q and Arlo Q Plus, an indoor wired solution that allows users to monitor their surroundings; and Arlo Go, an LTE-enabled wire-free camera that provides untethered mobile security. It also provides Arlo Baby, a baby monitor with air quality and temperature sensors, motion and audio detection, and advanced night vision; Arlo Chime that pairs with the Arlo Video Doorbell to play a variety of ringtones or act as a siren; Arlo Ultra, an integrated spotlight and crystal-clear two-way audio with advanced noise cancellations camera; Arlo Pro 3, an integrated spotlight with color night vision camera; Arlo Video Doorbell delivers direct-to-mobile video calls and personalized alerts; Arlo Floodlight Camera, a wire-free variant LED camera, as well as Arlo Essential Spotlight; Arlo Ultra 2; Arlo Essential XL Spotlight; Arlo Essential Wire-Free Video Doorbell; and Arlo Pro 4 Wire-Free Spotlight. In addition, it provides Arlo accessories, such as charging accessories, device mounts, and device skins. Further, it offers Arlo app for iOS and Android devices that allow users to connect various devices; and Arlo Secure, with coverage for unlimited cameras and an enhanced emergency response solutions. The company offers its products through retailers, wholesale distributors, broadcast channels, wireless carriers, and security solution providers, as well as through its website. Arlo Technologies, Inc. was incorporated in 2018 and is headquartered in Carlsbad, California.

VALUATION

P/E

46.34 Market Cap ($M USD)

$1.44B

Forward P/E

13.43 PEG

0.05 PRICE TO SALES

2.57 PRICE TO BOOK

8.91 EV / EBITDA

48.57 5-Year Average P/E

Free Cash Flow Yield

4.46%

DCF Value

$10.88

Graham Number

$3.10

Price to FCF

22.44 EV to FCF

20.16 Earnings Yield

2.16%

FCF Yield

4.46%

DIVIDEND

Yield

0.00%

Annual Payout

$0.00

Payout Ratio

0.00%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

$0.29

Next Year EPS Growth Estimate

$0.99

Next Year Revenue Growth Estimate

$61.52B

Return on Equity (ROE)

22.92%

FREE CASH FLOW

Operating Margin

2.69%

Debt-to-Equity

0.05 Piotroski F-Score

6 Altman Z-Score

4.96 Return on Invested Capital (ROIC)

8.45%

Current Ratio

1.52 Quick Ratio

1.28 Net Debt to EBITDA

-5.49

Interest Coverage

0.00 Gross Profit margin

45.09%

FCF PER SHARE

$0.60

REVENUE PER SHARE

$5.24

Gainseekers Quantitative Analysis

Summary

Arlo Technologies, Inc. presents a mixed valuation picture. The stock has traded above its DCF value, suggesting potential overvaluation, yet the Forward P/E of 15.89 indicates more reasonable expectations for future earnings. The Earnings Yield of 1.88% is modest, but the robust Altman Z-score of 5.60 signals strong financial stability. Despite a high Price/Book ratio of 10.24, the company’s low Debt/Equity ratio of 0.05 suggests a conservative capital structure. Overall, the market may be pricing in growth optimism, but caution is warranted given the valuation metrics.

AI Exposure / Tech Reliance

Operating in the Security & Protection Services industry, Arlo is well-positioned to leverage AI advancements. The integration of AI into security solutions can enhance product offerings and operational efficiency. This adaptability is crucial in maintaining a competitive edge in a rapidly evolving tech landscape.

The Bull Case

For the value-driven investor, Arlo's appeal lies in its efficient capital management and growth potential. With a Return on Equity of 22.92% and a Piotroski F-Score of 6, the company demonstrates solid financial health and operational efficiency. The Free Cash Flow Yield of 3.88% indicates decent cash generation relative to its market cap, while a Gross Profit Margin of 45.09% underscores strong pricing power. These factors suggest a company capable of delivering shareholder value through disciplined execution.

The Bear Case

However, Arlo's high valuation multiples raise red flags. The Price/Sales ratio of 2.95 and EV to EBITDA of 56.64 suggest the stock is priced for perfection, leaving little room for error. The Price to FCF ratio of 25.79 further highlights potential overvaluation concerns. Additionally, with the stock trading near its 52-week high, technical overextension could pose a risk for investors seeking entry at current levels.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Buy

Average Analyst Price Target

$19.50

Institutional Ownership %

1-Year Beta

1.60 Insider Buying % (6 Mo)

Distance to 52-Week High

50.26%

Distance to 52-Week Low

16.73%

EARNINGS SURPRISE %

47.37%

50-DAY SMA

$13.97

200-DAY SMA

$14.95

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.