ADT (NYSE:ADT) and Bright Horizons Family Solutions (NYSE:BFAM) Head-To-Head Analysis

ADT (NYSE:ADT) and Bright Horizons Family Solutions (NYSE:BFAM) are both mid-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for ADT and Bright Horizons Family Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ADT	1	4	2	0	2.14
Bright Horizons Family Solutions	2	3	4	0	2.22

ADT presently has a consensus target price of $8.23, indicating a potential upside of 19.71%. Bright Horizons Family Solutions has a consensus target price of $95.88, indicating a potential upside of 46.27%. Given Bright Horizons Family Solutions’ stronger consensus rating and higher probable upside, analysts clearly believe Bright Horizons Family Solutions is more favorable than ADT.

Earnings and Valuation

This table compares ADT and Bright Horizons Family Solutions”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ADT	$5.13 billion	0.98	$595.95 million	$0.71	9.68
Bright Horizons Family Solutions	$2.93 billion	1.09	$193.12 million	$3.16	20.74

ADT has higher revenue and earnings than Bright Horizons Family Solutions. ADT is trading at a lower price-to-earnings ratio than Bright Horizons Family Solutions, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

ADT has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500. Comparatively, Bright Horizons Family Solutions has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500.

Insider & Institutional Ownership

87.2% of ADT shares are owned by institutional investors. 3.0% of ADT shares are owned by insiders. Comparatively, 1.4% of Bright Horizons Family Solutions shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares ADT and Bright Horizons Family Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ADT	11.85%	18.99%	4.40%
Bright Horizons Family Solutions	5.78%	20.09%	6.35%

Summary

Bright Horizons Family Solutions beats ADT on 9 of the 14 factors compared between the two stocks.

About ADT

ADT Inc. provides security, interactive, and smart home solutions to residential and small business customers in the United States. It operates through two segments, Consumer and Small Business, and Solar. The company provides burglar and life safety alarms, smart security cameras, smart home automation systems, and video surveillance systems. It primarily offers security designed to detect intrusion, control access, sense movement, smoke, fire, carbon monoxide, flooding, temperature, and other environmental conditions and hazards; and address personal medical emergencies, such as injuries or unanticipated falls. The company also provides automation and smart home solutions that allow customers to use their smart phones, smart phone application, or touchscreen panels in their homes to arm and disarm their security systems; record and view real-time video; and creates customized and automated schedules for connected devices; programs systems to react to defined events; integrates system with third-party connected devices, such as cameras, lights, thermostats, appliances, and garage doors, as well as offers monitoring and maintenance services. In addition, the company offers energy storage solutions, energy efficiency upgrades, and roofing services. It offers its products under the ADT, ADT Pulse, ADT+, and ADT Commercial brand names. The company was formerly known as Prime Security Services Parent, Inc. and changed its name to ADT Inc. in September 2017. ADT Inc. was founded in 1874 and is headquartered in Boca Raton, Florida.

About Bright Horizons Family Solutions

Bright Horizons Family Solutions Inc. provides early education and childcare, back-up care, educational advisory, and other workplace solutions services for employers and families in the United States, Puerto Rico, the United Kingdom, the Netherlands, Australia, and India. The company operates in three segments: Full Service Center-Based Child Care, Back-Up Care, and Educational Advisory and Other Services. The Full Service Center-Based Child Care segment offers traditional center-based child care and early education, preschool, and elementary education services. The Back-Up Care segment provides center-based back-up child care, in-home child and adult/elder dependent care, school-age camps, virtual tutoring, and self-sourced reimbursed care services through child care centers, school-age campuses, and in-home caregivers, as well as the back-up care network. The Educational Advisory and Other Services segment offers tuition assistance and student loan repayment program administration, workforce education, and related educational consulting services, as well as college admissions and college financial advisory services. The company was formerly known as Bright Horizons Solutions Corp. and changed its name to Bright Horizons Family Solutions Inc. in July 2012. Bright Horizons Family Solutions Inc. was founded in 1986 and is headquartered in Newton, Massachusetts.