Is Alarm.com Holdings, Inc. overvalued or undervalued?

As of 7 August 2025, Alarm.com Holdings, Inc. has moved from a fair to attractive valuation grade, indicating a more favorable outlook. The company appears to be undervalued, supported by a P/E ratio of 23, a PEG ratio of 0.70, and an EV to EBITDA of 16.66, which suggest that it is trading at a discount relative to its growth prospects and earnings potential.
In comparison to peers, Alarm.com Holdings, Inc. has a lower P/E ratio than Commvault Systems, Inc., which is very expensive at 91.74, and a more favorable EV to EBITDA than BlackLine, Inc. at 42.41. Despite recent underperformance, with a year-to-date return of -8.52% compared to the S&P 500's 12.22%, the valuation metrics indicate that Alarm.com may present a buying opportunity for investors looking for growth in the software products sector.