Resideo Technologies (REZI) AI Stock Analysis

• Market Cap: $3.14B
• Dividend Yield: N/A
• Average Volume (3M): 1.29M
• Price to Earnings (P/E): 54.4
• Beta (1Y): 1.45
• Revenue Growth: 14.02%
• EPS Growth: -69.91%
• Country: US
• Employees: 14,600
• Sector: Industrials
• Sector Strength: 90
• Industry: Security & Protection Services
• EPS (TTM): 0.63
• Shares Outstanding: 148,503,540
• 10 Day Avg. Volume: 1,231,068
• 30 Day Avg. Volume: 1,293,940
• PEG Ratio: -0.54
• Price to Book (P/B): 0.79
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.24
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $23.00
• Price Target Upside: 6.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

Resideo Technologies presents a solid investment potential with strong revenue growth and effective cash flow management. The company's proactive strategies to mitigate challenges, including tariff impacts, and its robust earnings call performance enhance its attractiveness. However, the stock's current valuation and technical resistance levels pose some risks. Overall, the company is well-positioned in its industry, with promising growth prospects despite some financial and market challenges.

Positive Factors

Market Share and Demand

REZI is taking share on the back of early new product introduction and gaining more content spend per household.

Product Innovation

REZI is gaining more content spend per household and is ahead with new product introductions.

Revenue and Margin Performance

Revenue outperformed expectations, both businesses grew organically, and gross margins expanded more than expected.

Negative Factors

Growth Targets

Organic growth has been flat to up slightly, well below the mid-single-digit growth targets set by management in 2021.

Tariff Risk

The biggest risk facing REZI is potential tariffs on imports from Mexico, where 50% of manufacturing is based.

Resideo Technologies Business Overview & Revenue Model

Company Description

Resideo Technologies, Inc. develops, manufactures, and sells comfort, residential thermal, and security solutions to the commercial and residential end markets in the United States, Europe, and internationally. The company operates in two segments, Products & Solutions, and ADI Global Distribution. It offers temperature and humidity control, thermal water, and air solutions; and security panels, sensors, peripherals, wires and cables, communication devices, video cameras, awareness solutions, cloud infrastructure, installation and maintenance tools, and related software products under the Honeywell Home brand. In addition, the company distributes security products comprising video, intrusion, and access control products; and smart home, fire, power, audio, ProAV, networking, communication, wire and cable, enterprise connectivity, and structured wiring products to contractors that service non-residential and residential end-users. It sells its products through a network of distributors, original equipment manufacturers, and service providers, as well as retail and online channels. Resideo Technologies, Inc. was incorporated in 2018 and is headquartered in Scottsdale, Arizona.

How the Company Makes Money

Resideo Technologies generates revenue primarily through the sale of its smart home products and solutions. The company's key revenue streams include its portfolio of home comfort and security products such as thermostats, security cameras, sensors, and water leak detectors. Additionally, Resideo offers professional installation services and ongoing support, which contribute to its revenue. The company benefits from partnerships with major retailers and professional contractors, as well as its established distribution network, which helps to drive sales in both the consumer and professional markets. Resideo also pursues strategic acquisitions to expand its product offerings and enhance its market position, further supporting its revenue growth.

Resideo Technologies Financial Statement Overview

Summary

Resideo Technologies shows strong financial health with robust revenue growth and efficient cash flow management. However, the decline in net income and return on equity highlights areas for improvement. Maintaining operational efficiencies and managing leverage effectively will be key to future financial stability and growth.

Income Statement

The company demonstrated solid revenue growth of 8.3% in 2024, continuing a positive trend from previous years. However, net income decreased significantly from 2023 to 2024, leading to a reduced net profit margin of 1.7%. The gross profit margin remained stable at 28.1%. EBIT and EBITDA margins are strong at 7.7% and 7.7% respectively, indicating operational efficiency despite the decline in net income.

Balance Sheet

Resideo Technologies maintains a manageable debt-to-equity ratio of 0.60, slightly up from the previous year, indicating a responsible leverage level. The equity ratio improved to 40.3%, showing a strong equity base. However, the return on equity decreased to 3.5%, reflecting a decline in profitability relative to shareholders' equity.

Cash Flow

The company achieved a 8.7% growth in free cash flow in 2024, showcasing effective cash management. The operating cash flow to net income ratio is high at 3.83, indicating strong cash generation relative to net income. Free cash flow to net income ratio also improved, demonstrating solid cash flow performance despite reduced net income.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
6.76B	6.24B	6.37B	5.85B	5.07B
	Gross Profit
1.90B	1.70B	1.77B	1.56B	1.31B
	EBIT
520.00M	547.00M	611.00M	401.00M	164.00M
	EBITDA
446.00M	518.00M	779.00M	657.00M	251.00M
	Net Income Common Stockholders
116.00M	210.00M	283.00M	242.00M	37.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
692.00M	636.00M	326.00M	779.00M	517.00M
	Total Assets
8.20B	6.64B	6.39B	5.85B	5.61B
	Total Debt
1.98B	1.61B	1.42B	1.23B	1.16B
	Net Debt
1.29B	977.00M	1.09B	451.00M	645.00M
	Total Liabilities
4.89B	3.90B	3.86B	3.60B	3.62B
	Stockholders Equity
3.31B	2.75B	2.53B	2.25B	1.99B
Cash Flow		Free Cash Flow
364.00M	335.00M	67.00M	252.00M	174.00M
	Operating Cash Flow
444.00M	440.00M	152.00M	315.00M	244.00M
	Investing Cash Flow
-1.41B	-44.00M	-764.00M	-65.00M	-103.00M
	Financing Cash Flow
1.03B	-64.00M	170.00M	20.00M	253.00M

Resideo Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 21.51
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For REZI, the sentiment is Positive. The current price of 21.51 is above the 20-day moving average (MA) of 17.30, above the 50-day MA of 17.32, and above the 200-day MA of 20.70, indicating a bullish trend. The MACD of 0.97 indicates Negative momentum. The RSI at 77.27 is Negative, neither overbought nor oversold. The STOCH value of 91.54 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for REZI.

Resideo Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSSC	80 Outperform	$977.34M	22.32	27.48%	1.80%	-1.05%	-2.78%
BRC	76 Outperform	$3.59B	18.75	17.92%	1.27%	6.20%	5.12%
REZI	75 Outperform	$3.14B	54.41	2.58%	―	14.02%	-69.91%
ARLO	75 Outperform	$1.38B	―	-21.34%	―	0.27%	-18.75%
ADT	72 Outperform	$7.04B	14.39	16.26%	2.62%	-5.44%	-16.05%
BCO	68 Neutral	$4.08B	25.96	54.50%	1.03%	1.97%	41.88%
Sector *	64 Neutral	$4.38B	12.03	5.25%	249.91%	4.11%	-11.02%

Resideo Technologies Corporate Events

Resideo Technologies Announces Departure of Key Executive

On January 15, 2025, Resideo Technologies, Inc. announced that Tina Beskid, the Senior Vice President and Chief Accounting Officer, will have her employment terminated effective March 14, 2025. This decision entitles Ms. Beskid to severance under the company’s Severance Plan for Designated Officers.