SMRT · SmartRent
Conviction · Medium · more likely to lead the S&P 500 over the next three months, by a modest margin
Wrong if: a daily close below $1.35
Note written ·
How this view changed
- · Rating raised from Low to Medium. Guidance, 4 November 2026: SmartRent's Q3 2026 revenue of $41.566M beat the $40.062M estimate, every threshold in the previous note held, and management guided Q4 total revenue growth of 15% to 20% and adjusted EBITDA growth of about 450% to 650%.
Price against the kill line
17.8% clear of its kill line on the 13 November 2026 close.
How to read this
The red mark is the price level of the published kill line: a close through it (a weekly close, on a weekly line) would prove the research note wrong on price. The dot is where the stock closed on 13 November 2026; a dot left of the mark has closed through its line.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close below $1.35, on record since 11 November 2026. The shares are up 7.4% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close below $1.35, the close before the third-quarter report, which would erase the post-report gain. Gross margin below 41.2% or adjusted EBITDA below zero in the fourth-quarter report would also show the case failing.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 4 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 41.6
- Revenue, change on a year (%)
- +14.8
- Gross margin (%)
- 41.2
- Operating margin (%)
- −11.6
- Free cash flow, four quarters ($M)
- 3.8
- Free-cash-flow yield (%)
- 1.3
All filed numbers
What SmartRent reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 41.6 | +14.8 | 41.2 | −11.6 |
| first filed | 39.8 | +4.0 | 40.7 | −16.2 |
| first filed | 38.7 | −6.4 | 39.1 | −13.2 |
| first filed | 36.5 | +3.1 | 38.6 | −10.9 |
| first filed | 36.2 | −10.6 | 26.4 | −19.4 |
| first filed | 38.3 | −21.0 | 33.1 | −30.5 |
| Pre-tax income ($M) | −4.1 |
| Net income ($M) four quarters: −17.2 | −3.9 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | +1.4 |
| Operating cash flow ($M) | 4.3 |
| Capital spending ($M) | 0.5 |
| Free cash flow ($M) | 3.8 |
| Cash and short-term investments ($M) | 89.2 |
| Debt ($M) | Not available |
| Net cash, cash less debt ($M) | Not available |
| Deferred revenue ($M) −35.2% on a year | 38.1 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 33.6 |
| Inventory ($M) | 21.0 |
| Shareholders' equity ($M) | 220 |
| Market value ($M) | 302 |
| Enterprise value, market value plus net debt ($M) | Not available |
| Enterprise value to sales (×) | Not available |
| Enterprise value to operating income (×) | Not available |
| Price to earnings (×) | Not meaningful |
| Price to book value (×) | 1.4 |
| Free-cash-flow yield (%) | 1.3 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 4.4% of shares outstanding sold short, 15.9 days of average trading to cover, +1.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $77K | $0 |
| 12 monthsfrom | $2.3M | $0 |
The thesis
SmartRent's third-quarter results on 4 November 2026 showed a 41.2% gross margin and a fourth straight quarter of positive adjusted earnings before interest, taxes, depreciation and amortization (EBITDA). The shares are modestly more likely to lead the S&P 500 over three months. The fourth-quarter report, expected in early March 2027, tests the company's guide for 15% to 20% revenue growth.
Revenue was $41.566 million against a $40.062 million analyst estimate, and GAAP earnings per share were −$0.02, in line (Benzinga, 4 November 2026). Adjusted EBITDA was +$1.1 million against an adjusted loss of $2.9 million a year earlier (SmartRent results release, 4 November 2026).
The shares closed at $1.67 on 12 November 2026, 12.1% above the $1.49 close of 14 August 2026. The market already pays for the margin recovery. It has held a range of $1.59 to $1.70 in the six sessions since the report.
Bullish and bearish views on SmartRent, Inc.
The bull case on SmartRent, Inc. (SMRT), in brief: margins keep expanding. The bear case: recurring revenue slipped.
Bull case
- Margins keep expanding. Gross margin rose about 1,470 basis points to 41.2% from 26.4% a year earlier. Fourth-quarter 2025 gross margin was 38.6% (company releases, 4 March 2026 and 4 November 2026).
- Adjusted profit is widening. Adjusted EBITDA was +$1.1 million in the third quarter, and net loss narrowed to $3.9 million from $6.3 million a year earlier.
- Guidance points up. Management guided fourth-quarter total revenue growth of 15% to 20%, core revenue growth of 20% to 25% and adjusted EBITDA growth of about 450% to 650% (company release, 4 November 2026). Benzinga put the implied sales range at $41.943 million to $43.766 million.
- Growth accelerated. Total revenue grew about 15% in the third quarter against 4% in the second. Core revenue, management's recurring-weighted subset, was $40.7 million, up about 24%.
- The balance sheet is clean. Cash was $89.2 million at 30 September 2026, with no debt and an undrawn $75 million credit facility. The company repurchased 2.5 million shares for $3.4 million in the third quarter.
- Bookings stayed high. Trailing-twelve-month units booked were 122,510, up 44%, and units deployed reached 941,977, up 8% (release, 4 November 2026).
- Insiders have bought at lower prices. Director Thomas Bohjalian bought 55,000 shares on the open market at an average of $1.39 on 19 August 2026 and 20 August 2026 (SEC Form 4).
Bear case
- Recurring revenue slipped. Annual recurring revenue (ARR) was $62.9 million, up 11% from a year earlier, below the $64.5 million, up 13%, reported for the second quarter (company releases, 5 August 2026 and 4 November 2026). This is the weak point in a recurring-revenue story.
- Services revenue is shrinking. Professional services revenue fell 8% to $6.5 million (release, 4 November 2026).
- Profit exists only on the adjusted measure. Third-quarter GAAP earnings per share were −$0.02 and net loss was $3.9 million.
- The guide has little cushion in the price. The shares closed at $1.67 on 12 November 2026, above the 50-day average of $1.28 and the 200-day average of $1.33 (adjusted daily closes), so a result at the low end of the guide would meet a price that has already risen.
- Coverage is thin and conflicting. MarketBeat listed a $1.20 consensus target from three analysts in September, and other aggregators show figures from $1.35 to $1.79. Those figures predate the 4 November 2026 report.
- Insider activity is mostly equity compensation. Chief Revenue Officer Natalie Cariola exercised options on 17,147 shares on 12 November 2026, with 4,604 shares withheld for tax at $1.70 (SEC Form 4). That is a tax withholding, not an open-market sale.
Price setup
The last close was $1.67 on 12 November 2026, after $1.70 on 11 November 2026 and $1.61 on 10 November 2026. The 52-week intraday high is $2.20, set on 15 December 2025, and the last close is 24.1% below it. The 52-week closing low is $0.95, set on 24 July 2026.
The 50-day average is $1.28 and the 200-day average is $1.33, both as of the 12 November 2026 close. The shares trade above both. The August insider purchases averaged $1.39, below the current price.
The price reflects the margin and profit recovery from the third-quarter report. It does not yet reflect a fourth-quarter result, which arrives after the three-month window opens and may land near its end or beyond it.
Catalysts ahead
- ~3 March 2027 (est.): Fourth-quarter and full-year 2026 results (the prior year's report came on 4 March 2026). Shows whether revenue lands inside the 15% to 20% growth guide, whether gross margin holds at or above 41.2% and whether adjusted EBITDA stays positive.
What would change the view
A daily close below $1.35, the close before the third-quarter report, which would erase the post-report gain. Gross margin below 41.2% or adjusted EBITDA below zero in the fourth-quarter report would also show the case failing.
The risks this note tracks, each with what would confirm it:
- Annual recurring revenue fell to $62.9 million in the third quarter from $64.5 million in the second, and growth slowed to 11% from 13%, which cuts against the recurring-revenue part of the case. Confirmed by: annual recurring revenue below $62.9 million in the fourth-quarter report, or company commentary attributing the decline to customer churn.
- Growth leans on hardware and installation, and professional services revenue fell 8% to $6.5 million in the third quarter, so a hardware slowdown or tariff cost would hit revenue and margin together. Confirmed by: gross margin below 41.2% or core revenue growth below the 20% to 25% guide in the fourth-quarter report.
- The shares closed at $1.67 on 12 November 2026, above both the 50-day average of $1.28 and the 200-day average of $1.33, so a result at the low end of the guide has less cushion. Confirmed by: a fourth-quarter report landing at or below 15% total revenue growth, or a close back near the two moving averages.
- Profit exists only on the adjusted measure; the third-quarter GAAP net loss was $3.9 million. Confirmed by: adjusted EBITDA falling below zero, or the GAAP loss widening from $3.9 million in the fourth-quarter report.
- Thin analyst coverage and conflicting aggregator targets mean one revision can reset the consensus. Confirmed by: a target cut or rating downgrade published after the third-quarter report.
What it trades with
SmartRent's results depend on multifamily housing operators' spending on smart-home hardware and software, so apartment-sector demand and interest rates matter more to it than the broad technology sector. Hardware costs and tariffs affect gross margin because hardware and installation lines are a large share of revenue.
The shares are a sub-$2 micro-cap, so daily moves are larger than those of the S&P 500 and respond to small volume changes. The 4 November 2026 results and the fourth-quarter guide are the identifiable company events behind the post-report move.
The evidence, claim by claim (8)
- Third-quarter 2026 total revenue was $41.566 million against a $40.062 million analyst estimate; GAAP earnings per share were −$0.02, in line with the estimate. Benzinga earnings summary · as of
- Total revenue rose about 15% from a year earlier; core revenue was $40.7 million, up about 24%; professional services revenue was $6.5 million, down 8%. SmartRent third-quarter 2026 results release · as of
- Gross margin was 41.2%, up about 1,470 basis points from 26.4% a year earlier; adjusted EBITDA was +$1.1 million against a $2.9 million adjusted loss a year earlier; net loss was $3.9 million versus $6.3 million. SmartRent third-quarter 2026 results release · as of
- Annual recurring revenue was $62.9 million, up 11% from a year earlier, against $64.5 million, up 13%, in the second quarter of 2026. SmartRent third-quarter and second-quarter 2026 results releases · as of
- Trailing-twelve-month units booked were 122,510, up 44%; units deployed were 941,977, up 8%. SmartRent third-quarter 2026 results release · as of
- Fourth-quarter 2026 guidance: total revenue growth of 15% to 20%, core revenue growth of 20% to 25%, adjusted EBITDA growth of about 450% to 650%. Benzinga put fourth-quarter sales at $41.943 million to $43.766 million. SmartRent third-quarter 2026 results release; Benzinga · as of
- Fourth-quarter 2025 revenue was $36.5 million, gross margin 38.6% and adjusted EBITDA $0.2 million; the report came on 4 March 2026. SmartRent fourth-quarter and full-year 2025 results release · as of
- Cash was $89.2 million with no debt and an undrawn $75 million credit facility. SmartRent third-quarter 2026 results release · as of
Sources
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