Reviewing Alarum Technologies (NASDAQ:ALAR) & SecureWorks (NASDAQ:SCWX)

Alarum Technologies (NASDAQ:ALAR) and SecureWorks (NASDAQ:SCWX) are both small-cap business services companies, but which is the better business? We will compare the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, dividends, analyst recommendations and risk.

Risk & Volatility

Alarum Technologies has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, SecureWorks has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Profitability

This table compares Alarum Technologies and SecureWorks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alarum Technologies	-20.83%	6.52%	3.85%
SecureWorks	-23.52%	-9.56%	-6.58%

Institutional and Insider Ownership

3.2% of Alarum Technologies shares are held by institutional investors. Comparatively, 14.4% of SecureWorks shares are held by institutional investors. 2.7% of Alarum Technologies shares are held by company insiders. Comparatively, 83.1% of SecureWorks shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Alarum Technologies and SecureWorks, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alarum Technologies	0	0	1	0	3.00
SecureWorks	1	1	0	0	1.50

Alarum Technologies presently has a consensus target price of $23.00, indicating a potential downside of 18.35%. SecureWorks has a consensus target price of $7.08, indicating a potential upside of 6.20%. Given SecureWorks’ higher possible upside, analysts plainly believe SecureWorks is more favorable than Alarum Technologies.

Valuation and Earnings

This table compares Alarum Technologies and SecureWorks’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alarum Technologies	$26.52 million	6.79	-$5.53 million	($1.72)	-16.38
SecureWorks	$365.88 million	1.61	-$86.04 million	($1.01)	-6.60

Alarum Technologies has higher earnings, but lower revenue than SecureWorks. Alarum Technologies is trading at a lower price-to-earnings ratio than SecureWorks, indicating that it is currently the more affordable of the two stocks.

About Alarum Technologies

Alarum Technologies Ltd. provides internet access and web data collection solutions in North, South, and Central America, Europe, Southeast Asia, the Middle East, and Africa. The company operates through two segments, Enterprise Internet Access Solutions and Consumer Internet Access Solutions. The company offers security blanket against ransomware, viruses, phishing, and other online threats, as well as secured and encrypted connection, masking the customers online activity and keeping them safe from hackers. It also provides privacy solutions and services, a software solution that uses an encryption protocol which is defined upon the process being used to generate a secured encrypted path and keep the users' data private and safe; and web data collection solution allows organizations to collect vast amounts of web and internet data by simultaneously connecting to the Internet from different IP addresses. In addition, the company offers static residential proxy network, rotating residential proxy network, data center proxy network, premium dedicated static residential proxies, mobile proxies, SERP data collection service, and social data collection service, as well as advertising services to enterprise customers. The company offers its products through resellers and internet service providers. It serves advertising and media companies, financial organizations, cyber security companies, industrial and commercial companies, online companies, education institutions, and AI recruitment market and other sectors. The company was formerly known as Safe-T Group Ltd. and changed its name to Alarum Technologies Ltd. in January 2023. Alarum Technologies Ltd. was founded in 2013 and is headquartered in Tel Aviv, Israel.

About SecureWorks

SecureWorks Corp., through its subsidiaries, provides technology-driven information security solutions for protecting its customers in the United States and internationally. The company's solutions include software-as-a-service solutions; managed security services; and professional services, including incident response and penetration testing services. Its solutions enable organizations to prevent security breaches, detect malicious activity, respond rapidly to security breaches, and identify emerging threats. The company sells its solutions primarily through its referral agents, regional value-added resellers, trade associations, and managed security service providers. It serves customers in a range of industries, including financial services, manufacturing, technology, retail, insurance, utility, and healthcare sectors. The company was formerly known as SecureWorks Holding Corporation and changed its name to SecureWorks Corp. in November 2015. SecureWorks Corp. was founded in 1999 and is headquartered in Atlanta, Georgia. SecureWorks Corp. is a subsidiary of Dell Marketing L.P.