Arlo Technologies Inc. Common Stock (ARLO)

FairStock Score: 41/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Arlo is a small smart-home security company that has just completed a turnaround. In fiscal 2024, the year ended 2024-12-31, it lost $30.5 million on $510.9 million of revenue. In fiscal 2025, the year ended 2025-12-31, revenue rose to $529.3 million and net income was $14.9 million, or $0.14 per diluted share. More recently, fiscal Q2 2026, the quarter ended 2026-06-28, showed revenue of $155.9 million versus $129.4 million in fiscal Q2 2025, but net income slipped to $3.0 million from $3.1 million, only a 1.94% margin. Fiscal Q1 2026 was much stronger at $14.9 million of net income. So earnings are lumpy and thin. That financial picture has strengths. Debt is modest with a D/E of 0.04, the Altman Z-Score is 2.93, and trailing free cash flow is $66.9 million, a 5.1% FCF yield against the $1.3 billion market cap. But ROE of 22.07% sits beside ROCE of only 1.37%, a gap that makes me question the true return on operating capital. The Piotroski F-Score is 5/9. At the 2026-10-13 close of $12.07, FairStock's P/E is 43.11, P/B is 8.21, and EV/EBITDA is 53.54. FairStock's Graham Number is $3.04, implying the price is far above a conservative asset-and-earnings value, with a margin of safety of -297.04%. The FairStock Score is 41/100. The computed Lynch category is TURNAROUND because it returned to profit after a loss within the last three years. Turnarounds can reward patience, but they need durable margins and a margin of safety. Here revenue momentum is encouraging, yet profitability is inconsistent, returns on capital are low, and the valuation already discounts a lot of improvement.

In plain English: Arlo makes smart home security cameras, doorbells, and related cloud services. The business has grown sales and returned to a small profit after earlier losses, but profits are thin and uneven. At the 2026-10-13 close of $12.07, the price looks high compared with the company's profits, accounting value, and cash generation.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-28) · fiscal Q1 2026 10-Q (period ended 2026-03-29) · fiscal Q3 2025 10-Q (period ended 2025-09-28) · fiscal Q2 2025 10-Q (period ended 2025-06-29) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer