Arlo Technologies (NYSE:ARLO) Shares Gap Up Following Strong Earnings

Key Points

• Arlo beat Q1 estimates with EPS of $0.28 vs. $0.19 expected and revenue of $150.4M (+26.3% YoY), prompting the stock to gap up to a $16.12 open.
• The Board approved a $50.0 million share buyback (about 3.1% of shares outstanding), a move that typically signals management believes the stock is undervalued.
• Management guided Q2 to $0.17–$0.23 EPS, but insiders (including the CEO and CFO) have recently sold sizable positions while analysts maintain a "Moderate Buy" consensus with a $23.33 target.

Arlo Technologies, Inc. (NYSE:ARLO - Get Free Report) gapped up prior to trading on Friday following a better than expected earnings announcement. The stock had previously closed at $14.90, but opened at $16.12. Arlo Technologies shares last traded at $16.1510, with a volume of 522,375 shares.

The company reported $0.28 EPS for the quarter, topping the consensus estimate of $0.19 by $0.09. The business had revenue of $150.38 million during the quarter, compared to analysts' expectations of $139.73 million. Arlo Technologies had a return on equity of 10.76% and a net margin of 2.82%.Arlo Technologies's revenue was up 26.3% compared to the same quarter last year. During the same quarter last year, the firm posted $0.15 earnings per share. Arlo Technologies has set its Q2 2026 guidance at 0.17-0.230 EPS.

Arlo Technologies announced that its Board of Directors has approved a stock buyback program on Wednesday, March 4th that allows the company to repurchase $50.00 million in shares. This repurchase authorization allows the company to buy up to 3.1% of its shares through open market purchases. Shares repurchase programs are typically an indication that the company's leadership believes its stock is undervalued.

Analysts Set New Price Targets

Separately, Weiss Ratings raised Arlo Technologies from a "sell (d+)" rating to a "hold (c-)" rating in a research report on Friday, March 6th. Three research analysts have rated the stock with a Buy rating and two have given a Hold rating to the company's stock. According to MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus target price of $23.33.

Insider Buying and Selling

In related news, CFO Kurtis Joseph Binder sold 25,000 shares of the stock in a transaction on Friday, April 17th. The stock was sold at an average price of $15.19, for a total transaction of $379,750.00. Following the completion of the sale, the chief financial officer directly owned 564,885 shares in the company, valued at approximately $8,580,603.15. This trade represents a 4.24% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Matthew Blake Mcrae sold 153,433 shares of the stock in a transaction on Thursday, March 12th. The stock was sold at an average price of $13.78, for a total value of $2,114,306.74. Following the sale, the chief executive officer owned 1,168,866 shares of the company's stock, valued at approximately $16,106,973.48. This represents a 11.60% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last ninety days, insiders sold 465,478 shares of company stock worth $6,522,193. Corporate insiders own 2.90% of the company's stock.

Hedge Funds Weigh In On Arlo Technologies

Several hedge funds have recently bought and sold shares of ARLO. Vanguard Group Inc. boosted its stake in shares of Arlo Technologies by 0.3% during the 4th quarter. Vanguard Group Inc. now owns 10,691,336 shares of the company's stock worth $149,572,000 after acquiring an additional 32,770 shares in the last quarter. Brandes Investment Partners LP boosted its position in Arlo Technologies by 27.6% during the fourth quarter. Brandes Investment Partners LP now owns 8,198,707 shares of the company's stock worth $114,700,000 after purchasing an additional 1,772,063 shares during the period. Wasatch Advisors LP grew its holdings in Arlo Technologies by 17.7% during the third quarter. Wasatch Advisors LP now owns 5,505,467 shares of the company's stock valued at $93,318,000 after purchasing an additional 826,587 shares during the last quarter. State Street Corp raised its position in shares of Arlo Technologies by 5.3% in the second quarter. State Street Corp now owns 4,272,925 shares of the company's stock valued at $72,469,000 after purchasing an additional 215,867 shares during the period. Finally, Rice Hall James & Associates LLC lifted its stake in shares of Arlo Technologies by 2.9% in the fourth quarter. Rice Hall James & Associates LLC now owns 3,576,612 shares of the company's stock worth $50,037,000 after buying an additional 100,831 shares during the last quarter. 83.18% of the stock is owned by institutional investors and hedge funds.

Arlo Technologies Price Performance

The stock's 50 day moving average price is $14.20 and its two-hundred day moving average price is $14.24. The firm has a market capitalization of $1.76 billion, a price-to-earnings ratio of 124.39 and a beta of 1.60.

Arlo Technologies Company Profile

Arlo Technologies, Inc NYSE: ARLO is a provider of smart home security products and services designed for residential and small business customers. The company offers a portfolio of wireless and Wi-Fi-enabled security cameras, video doorbells, smart lighting solutions, and associated accessories. Arlo integrates advanced video analytics, motion detection, cloud storage, and two-way audio capabilities to deliver end-to-end security and monitoring solutions accessible through mobile applications and web interfaces.

Founded as a division of Netgear, Inc in 2014 and spun off as an independent public company in 2018, Arlo Technologies has established a presence in North America, Europe, Australia and parts of Asia.

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