Frontdoor (FTDR)
Market Price (8/11/2026): $83.91 | Market Cap: $5.9 BilSector: Consumer Discretionary | Industry: Specialized Consumer Services
Frontdoor (FTDR)
Market Price (8/11/2026): $83.91Market Cap: $5.9 BilSector: Consumer DiscretionaryIndustry: Specialized Consumer Services
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 20% Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 19%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 18% Attractive yieldFCF Yield is 6.6% Low stock price volatilityVol 12M is 47% Megatrend and thematic driversMegatrends include Smart Buildings & Proptech. Themes include IoT for Buildings, Building Management Systems, and Real Estate Data Analytics. | Valuation getting more expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is 55% Key risksFTDR key risks include [1] significant indebtedness of approximately $2.5 billion that limits financial flexibility and [2] a heavy operational dependence on its large network of independent contractors for service delivery. |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 20% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 19%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 18% |
| Attractive yieldFCF Yield is 6.6% |
| Low stock price volatilityVol 12M is 47% |
| Megatrend and thematic driversMegatrends include Smart Buildings & Proptech. Themes include IoT for Buildings, Building Management Systems, and Real Estate Data Analytics. |
| Valuation getting more expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is 55% |
| Key risksFTDR key risks include [1] significant indebtedness of approximately $2.5 billion that limits financial flexibility and [2] a heavy operational dependence on its large network of independent contractors for service delivery. |
Qualitative Assessment
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Frontdoor (FTDR) stock has gained about 20% since 4/30/2026 because of the following key factors:
1. Frontdoor reported strong financial results for fiscal Q2 2026, surpassing analyst expectations.
The company announced revenue of $645 million, representing a 5% increase year-over-year. Diluted earnings per share (EPS) rose 19% to $1.76, and adjusted EPS reached $1.93, exceeding the Zacks Consensus Estimate of $1.78 by 8.43%.
2. The company raised its full-year 2026 financial guidance.
Frontdoor increased its full-year 2026 revenue outlook to a range of $2.19 billion to $2.21 billion, an increase of $25 million at the midpoint. Additionally, the adjusted EBITDA guidance was raised to $585 million to $600 million, up $20 million at the midpoint, signaling management's confidence in continued strong performance.
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Frontdoor (FTDR) stock has gained about 20% since 4/30/2026 because of the following key factors:
1. Frontdoor reported strong financial results for fiscal Q2 2026, surpassing analyst expectations.
The company announced revenue of $645 million, representing a 5% increase year-over-year. Diluted earnings per share (EPS) rose 19% to $1.76, and adjusted EPS reached $1.93, exceeding the Zacks Consensus Estimate of $1.78 by 8.43%.
2. The company raised its full-year 2026 financial guidance.
Frontdoor increased its full-year 2026 revenue outlook to a range of $2.19 billion to $2.21 billion, an increase of $25 million at the midpoint. Additionally, the adjusted EBITDA guidance was raised to $585 million to $600 million, up $20 million at the midpoint, signaling management's confidence in continued strong performance.
3. Frontdoor achieved its first organic growth in total ending member count in five years.
Total home warranty ending member count increased by 1% to 2.11 million in fiscal Q2 2026, driven by growth in first-year members. This marks a significant inflection point for the company, with direct-to-consumer member count rising 5% and the real estate channel growing 7%.
4. Enhanced profitability was driven by lower claims costs and effective pricing strategies.
Gross profit margin improved by 100 basis points to 59% in fiscal Q2 2026. This was partly due to a $7 million decrease in contract claims costs, which included a $5 million benefit from favorable weather. Furthermore, higher realized pricing contributed approximately three percentage points to revenue growth. Net income increased 13% to $125 million, and adjusted EBITDA grew 10% to $220 million.
5. The company demonstrated a commitment to shareholder returns through substantial share repurchases.
Frontdoor completed $181 million in share repurchases year-to-date through July 2026, a figure more than 21% higher than the corresponding prior-year period. The company anticipates repurchasing approximately $330 million of its stock in 2026, aiming to complete its current authorization nearly a year ahead of schedule.
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Stock Movement Drivers
Fundamental Drivers
The 22.3% change in FTDR stock from 4/30/2026 to 8/10/2026 was primarily driven by a 14.9% change in the company's P/E Multiple.| (LTM values as of) | 4302026 | 8102026 | Change |
|---|---|---|---|
| Stock Price ($) | 68.63 | 83.91 | 22.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 2,119 | 2,148 | 1.4% |
| Net Income Margin (%) | 12.3% | 12.8% | 4.0% |
| P/E Multiple | 18.6 | 21.4 | 14.9% |
| Shares Outstanding (Mil) | 71 | 70 | 1.0% |
| Cumulative Contribution | 22.3% |
Market Drivers
4/30/2026 to 8/10/2026| Return | Correlation | |
|---|---|---|
| FTDR | 22.3% | |
| Market (SPY) | 7.6% | 8.8% |
| Sector (XLY) | 1.1% | 21.6% |
Fundamental Drivers
The 42.0% change in FTDR stock from 1/31/2026 to 8/10/2026 was primarily driven by a 30.8% change in the company's P/E Multiple.| (LTM values as of) | 1312026 | 8102026 | Change |
|---|---|---|---|
| Stock Price ($) | 59.11 | 83.91 | 42.0% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 2,042 | 2,148 | 5.2% |
| Net Income Margin (%) | 12.9% | 12.8% | -1.0% |
| P/E Multiple | 16.4 | 21.4 | 30.8% |
| Shares Outstanding (Mil) | 73 | 70 | 4.1% |
| Cumulative Contribution | 42.0% |
Market Drivers
1/31/2026 to 8/10/2026| Return | Correlation | |
|---|---|---|
| FTDR | 42.0% | |
| Market (SPY) | 12.0% | 18.9% |
| Sector (XLY) | -1.0% | 30.7% |
Fundamental Drivers
The 43.4% change in FTDR stock from 7/31/2025 to 8/10/2026 was primarily driven by a 16.6% change in the company's P/E Multiple.| (LTM values as of) | 7312025 | 8102026 | Change |
|---|---|---|---|
| Stock Price ($) | 58.50 | 83.91 | 43.4% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 1,891 | 2,148 | 13.6% |
| Net Income Margin (%) | 12.6% | 12.8% | 1.4% |
| P/E Multiple | 18.4 | 21.4 | 16.6% |
| Shares Outstanding (Mil) | 75 | 70 | 6.9% |
| Cumulative Contribution | 43.4% |
Market Drivers
7/31/2025 to 8/10/2026| Return | Correlation | |
|---|---|---|
| FTDR | 43.4% | |
| Market (SPY) | 23.3% | 21.2% |
| Sector (XLY) | 8.7% | 29.8% |
Fundamental Drivers
The 140.3% change in FTDR stock from 7/31/2023 to 8/10/2026 was primarily driven by a 135.2% change in the company's Net Income Margin (%).| (LTM values as of) | 7312023 | 8102026 | Change |
|---|---|---|---|
| Stock Price ($) | 34.92 | 83.91 | 140.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 1,678 | 2,148 | 28.0% |
| Net Income Margin (%) | 5.4% | 12.8% | 135.2% |
| P/E Multiple | 31.3 | 21.4 | -31.6% |
| Shares Outstanding (Mil) | 82 | 70 | 16.6% |
| Cumulative Contribution | 140.3% |
Market Drivers
7/31/2023 to 8/10/2026| Return | Correlation | |
|---|---|---|
| FTDR | 140.3% | |
| Market (SPY) | 74.8% | 31.5% |
| Sector (XLY) | 40.9% | 34.0% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| FTDR Return | -27% | -43% | 69% | 55% | 6% | 57% | 81% |
| Peers Return | 24% | -42% | 33% | 14% | 21% | 6% | 40% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 13% | 107% |
Monthly Win Rates [3] | |||||||
| FTDR Win Rate | 33% | 33% | 58% | 50% | 58% | 62% | |
| Peers Win Rate | 62% | 38% | 53% | 48% | 55% | 50% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| FTDR Max Drawdown | -44% | -49% | -23% | -16% | -41% | -25% | |
| Peers Max Drawdown | -27% | -55% | -42% | -32% | -40% | -32% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: FAF, ORI, FNF, ANGI, PRCH. See FTDR Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 8/10/2026 (YTD)
How Low Can It Go
| Event | FTDR | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -36.3% | -18.8% |
| % Gain to Breakeven | 57.0% | 23.1% |
| Time to Breakeven | 94 days | 79 days |
| Summer-Fall 2023 Five Percent Yield Shock | ||
| % Loss | -17.4% | -9.5% |
| % Gain to Breakeven | 21.0% | 10.5% |
| Time to Breakeven | 10 days | 24 days |
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -10.3% | -6.7% |
| % Gain to Breakeven | 11.4% | 7.1% |
| Time to Breakeven | 48 days | 31 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -46.6% | -24.5% |
| % Gain to Breakeven | 87.2% | 32.4% |
| Time to Breakeven | 594 days | 427 days |
| 2020 COVID-19 Crash | ||
| % Loss | -33.1% | -33.7% |
| % Gain to Breakeven | 49.4% | 50.9% |
| Time to Breakeven | 55 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -50.9% | -19.2% |
| % Gain to Breakeven | 103.7% | 23.8% |
| Time to Breakeven | 223 days | 105 days |
In The Past
Frontdoor's stock fell -36.3% during the 2025 US Tariff Shock. Such a loss loss requires a 57.0% gain to breakeven.
Preserve Wealth
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Asset Allocation
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| Event | FTDR | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -36.3% | -18.8% |
| % Gain to Breakeven | 57.0% | 23.1% |
| Time to Breakeven | 94 days | 79 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -46.6% | -24.5% |
| % Gain to Breakeven | 87.2% | 32.4% |
| Time to Breakeven | 594 days | 427 days |
| 2020 COVID-19 Crash | ||
| % Loss | -33.1% | -33.7% |
| % Gain to Breakeven | 49.4% | 50.9% |
| Time to Breakeven | 55 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -50.9% | -19.2% |
| % Gain to Breakeven | 103.7% | 23.8% |
| Time to Breakeven | 223 days | 105 days |
In The Past
Frontdoor's stock fell -36.3% during the 2025 US Tariff Shock. Such a loss loss requires a 57.0% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About Frontdoor (FTDR)
Frontdoor, Inc. (FTDR) is a leading provider of home service plans, often referred to as home warranties, in the United States. Its core business involves offering homeowners comprehensive coverage for the repair or replacement of principal components across approximately 20 major home systems and appliances. This typically includes essential items like electrical and plumbing systems, central heating, ventilation, and air conditioning (HVAC) units, water heaters, and key kitchen appliances such as refrigerators, dishwashers, and ovens/cooktops.
Beyond its traditional home service plans, Frontdoor has expanded its offerings to include modern home service solutions. The company operates ProConnect, an on-demand home services business that facilitates quick access to professionals for various home repair needs. Furthermore, Frontdoor leverages advanced technology through its Streem platform, which utilizes augmented reality, computer vision, and machine learning to enable home service professionals to more accurately diagnose issues and efficiently complete repairs.
Frontdoor primarily serves homeowners across the U.S. under a portfolio of well-known brands, including American Home Shield, HSA, Landmark Home Warranty, and OneGuard, in addition to its eponymous Frontdoor brand and Streem. The company's objective is to provide peace of mind and simplify home maintenance for its customers by managing unexpected repair costs and facilitating access to qualified service professionals.
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Analogy 1: AAA for your home
Analogy 2: AppleCare for your entire house
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- Home Service Plans: These plans cover the repair or replacement of principal components of major home systems and appliances.
- ProConnect: An on-demand home services business connecting homeowners with professionals for various home repairs.
- Streem: A technology platform that uses augmented reality, computer vision, and machine learning to help home service professionals diagnose breakdowns and complete repairs.
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Frontdoor (FTDR) primarily serves individuals. Its major customers can be categorized as follows:
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Homeowners purchasing comprehensive service plans: These are individuals who subscribe to annual contracts (e.g., under the American Home Shield, HSA, Landmark Home Warranty, and OneGuard brands) to cover the repair or replacement of major home systems and appliances. They seek peace of mind, budgeting predictability, and convenience in managing potential home repairs.
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Homeowners utilizing on-demand home services: This category includes individuals who need immediate repairs or maintenance for specific issues and may use Frontdoor's ProConnect service to connect with home service professionals for ad-hoc services, often outside of a long-term plan.
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Homebuyers and Sellers: Homeowners who purchase or receive home service plans (often as part of a real estate transaction) to provide coverage during the home buying or selling process. These plans offer protection against unforeseen system or appliance breakdowns for a specified period, benefiting both parties in a real estate deal.
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Bill Cobb, Chairman, Chief Executive Officer
Bill Cobb was appointed Chief Executive Officer of Frontdoor in June 2022 and also serves as Chairman of the Board. He joined Frontdoor's board of directors in October 2018 and previously served on the board of its former parent company, ServiceMaster Global Holdings, Inc., from April 2018 until Frontdoor's separation in October 2018. Before Frontdoor, he held significant leadership roles including president and chief executive officer of H&R Block, Inc. from 2011 to 2017. From 2000 to 2008, he held various leadership positions at eBay, Inc., including president of eBay Marketplaces North America. Earlier in his career (1987-2000), Cobb held marketing and executive roles at PepsiCo and Tricon Global Restaurants, such as senior vice president and chief marketing officer for Tricon International and Pizza Hut. He currently serves on the board of directors of Deluxe Corporation.
Jason Bailey, Senior Vice President and Chief Financial Officer
Jason Bailey was appointed Senior Vice President and Chief Financial Officer of Frontdoor, effective November 10, 2025. He brings over 25 years of progressive leadership experience in finance and public accounting, with more than 15 years spent at Frontdoor and its former publicly traded parent, ServiceMaster. Prior to his current role, Bailey served as Vice President, Finance for Frontdoor. His professional background also includes 11 years in public accounting with Deloitte and Arthur Andersen.
Kathy Collins, Senior Vice President and Chief Revenue Officer
Kathy Collins was promoted to Senior Vice President and Chief Revenue Officer, effective January 1, 2024. In this role, she is responsible for overseeing and optimizing all revenue-generating activities for Frontdoor's brands, including product and service development, sales, marketing, and corporate partnerships. Previously, she served as the Senior Vice President and Chief Brand Officer for Frontdoor.
Evan Iverson, Senior Vice President and Chief Operations Officer
Evan Iverson was promoted to Senior Vice President and Chief Operations Officer, effective January 1, 2024. He is responsible for overseeing all day-to-day operational functions for the American Home Shield and Frontdoor brands, with a focus on enhancing contractor and member experiences. Iverson joined Frontdoor in January 2019 as Vice President of Operations and subsequently held positions as Vice President of Contractor Relations and Senior Vice President of Contractor Engagement.
Bala Ganesh, Senior Vice President and Chief Technology Officer
Dr. Bala Ganesh assumed the role of Senior Vice President and Chief Technology Officer for Frontdoor in July 2025. Prior to this, he served as a Frontdoor board director from July 2023 to June 2025. His previous experience includes serving as Chief Technology Officer at OnTrac Logistics and as a Partner at AKF Consulting LLC, a technology consulting firm. He also spent over 10 years at United Parcel Service (UPS) in various technology leadership positions, including Vice President of Engineering, Vice President of Advanced Technology, and Vice President of Advanced Analytics and Revenue Management.
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- Macroeconomic Conditions and Housing Market Sensitivity: Frontdoor's business is highly susceptible to broader economic conditions and trends in the housing market. Economic downturns, fluctuations in interest rates, and a cooling housing market can directly lead to reduced consumer spending on home service plans and a decrease in demand for new home warranties. This sensitivity can impact both customer acquisition and retention.
- Rising Costs and Contractor Dependence: The company's profitability is significantly affected by the cost of repairs and replacements of covered home systems and appliances, including the cost of labor and parts. Inflationary pressures and potential tariffs can increase these costs, thereby squeezing profit margins. Furthermore, Frontdoor relies on a vast network of independent contractors. Risks associated with this dependence include the availability and quality of these professionals, the ability to replace contractors in a timely manner if relationships are terminated, and potential increases in contractor costs, all of which can impact service delivery and customer satisfaction.
- Intense Competition: The home services and home warranty market is highly fragmented and competitive, with numerous established players and new entrants vying for market share. This intense competition can exert pressure on pricing, erode profit margins, and necessitate significant investment in marketing and customer acquisition strategies, making it challenging to maintain market position and grow customer numbers.
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The proliferation of smart home technology, IoT devices, and predictive maintenance solutions.
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Frontdoor, Inc. (FTDR) operates within significant addressable markets for its main products and services, primarily in the United States.
Home Service Plans
The addressable market for home service plans in the U.S. is substantial. The United States Home Warranty Market was valued at approximately $4.26 billion in 2024 and is projected to reach about $5.68 billion by 2032, growing at a CAGR of 4.19% from 2026 to 2032. Another estimate places the U.S. home warranty market size at $4.6 billion in 2026. Frontdoor itself recognizes this as a $4 billion opportunity in the U.S. with low penetration, where it holds a dominant 46% market share.
ProConnect On-Demand Home Services
The broader U.S. home services industry, which includes on-demand services like Frontdoor's ProConnect, represents an estimated annual revenue of over $500 billion. Frontdoor has stated its aim to transform this market with its on-demand offerings. More specifically, the U.S. online on-demand home services market is projected to grow to $1.7 billion by 2028. Globally, the online on-demand home services market was valued at $5.15 billion in 2024 and is estimated to grow to $19.65 billion by 2033. North America leads this global market, accounting for approximately 45% of the total market share.
Streem (Augmented Reality, Computer Vision, and Machine Learning Platform)
Frontdoor's Streem platform leverages augmented reality, computer vision, and machine learning to assist home service professionals. The global augmented reality market is anticipated to reach $591.7 billion by 2033, with an estimated size of $29.6 billion in 2024. In North America, the demand for augmented reality reached $7.6 billion in 2023. A significant application for augmented reality, remote assistance and maintenance, which aligns with Streem's function, represented 29.09% of revenues in the augmented reality market in 2025. The global computer vision market size was valued at $21.7 billion in 2025 and is estimated to grow to $35.4 billion by 2034.
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- Growth in Member Count: After stabilizing its member base in 2025, Frontdoor anticipates a resumption of member growth in 2026, marking the first increase since 2020. This growth is projected to be fueled by approximately 5% first-year channel growth and enhanced momentum in both the direct-to-consumer (DTC) and real estate channels.
- Expansion of Non-Warranty Services: The company is strategically expanding its non-warranty revenue streams. The new HVAC program demonstrated significant success, growing 48% to $128 million in 2025 and is forecasted to reach approximately $165 million in 2026. Additionally, Frontdoor has broadened its partnership with Moen and initiated an appliance upgrade pilot program, contributing to a 66% rise in non-warranty and other revenue in 2025, with projections of $220 million to $240 million for 2026.
- Strategic Price Increases: Frontdoor has realized revenue growth through a combination of increased volume and strategic price adjustments. Management anticipates that ongoing price increases of 2-3% will be a foundational element supporting its revenue guidance for 2026.
- Synergies from the 2-10 Acquisition: The integration of the 2-10 acquisition is progressing ahead of schedule, with over $20 million in cost synergies realized in 2025, surpassing the initial $10 million target. Frontdoor plans to migrate the 2-10 platform in 2026 to unlock further revenue synergies and strengthen its relationships with builders and real estate partners.
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Share Repurchases
- Frontdoor authorized a new three-year share repurchase program of up to $400 million in September 2021, with the program expected to run through September 2024.
- The company repurchased $160 million of shares in 2024, acquiring approximately 4 million shares, and an additional $280 million in 2025, which reduced shares outstanding by 7%.
- Since 2021, Frontdoor has cumulatively repurchased approximately 17 million shares totaling $720 million, leading to a net reduction of about 17% in shares outstanding. Furthermore, nearly half of a separate $650 million authorization, initiated in late 2024, has been completed, with the remaining $329 million anticipated to be utilized by early 2027.
Outbound Investments
- Frontdoor acquired 2-10 Home Buyers Warranty (2-10 HBW) in an all-cash transaction valued at $585 million, with the agreement entered into in June 2024 and the acquisition completed in December 2024.
- The acquisition was partially funded through a new $1.47 billion credit facility.
- The acquisition of 2-10 HBW diversifies Frontdoor's business into new home structural warranties, adding members, revenue, and EBITDA, and generated over $20 million in cost synergies during 2025.
Capital Expenditures
- Capital expenditures were $39 million in 2024 and $26 million in 2025, primarily directed towards recurring capital needs and technology projects.
- Frontdoor forecasts its capital expenditures for fiscal year 2026 to be in the range of $30 million to $35 million.
- The company operates with a "capital-light business model" but consistently invests in capability-expanding technology, focusing on its technology-enabled platform to enhance efficiency and service quality.
Latest Trefis Analyses
| Title | Date | |
|---|---|---|
| DASHBOARDS | ||
| Is 12.7% Fall In Frontdoor (FTDR) Stock A Buying Opportunity? | 03/19/2026 | |
| Frontdoor Earnings Notes | 12/28/2026 | |
| Is 21.8% Fall In Frontdoor (FTDR) Stock A Buying Opportunity? | 11/27/2025 | |
| Is 28.8% Fall In Frontdoor (FTDR) Stock A Buying Opportunity? | 11/07/2025 | |
| Is 20.4% Fall In Frontdoor (FTDR) Stock A Buying Opportunity? | 11/06/2025 | |
| Would You Still Hold Frontdoor Stock If It Fell 30%? | 10/17/2025 | |
| Frontdoor vs Newmont: Which Is A Better Investment? | 08/18/2025 | |
| How Does Frontdoor Stock Stack Up Against Its Peers? | 08/13/2025 | |
| ARTICLES | ||
| Does Frontdoor Stock Qualify as a Tier-1 Capital Compounder? | 05/04/2026 | |
| Time To Buy The Dip In Frontdoor Stock? | 03/19/2026 | |
| Frontdoor Stock To $70? | 11/27/2025 | |
| Frontdoor Stock To $65? | 11/07/2025 | |
| Why Frontdoor’s 16% Selloff May Be More Than a Blip | 11/06/2025 |
Research & Analysis
Invest in Strategies
Wealth Management
Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 45.23 |
| Mkt Cap | 6.6 |
| Rev LTM | 5,062 |
| Op Inc LTM | 237 |
| FCF LTM | 609 |
| FCF 3Y Avg | 451 |
| CFO LTM | 707 |
| CFO 3Y Avg | 568 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 12.4% |
| Rev Chg 3Y Avg | 8.2% |
| Rev Chg Q | 11.4% |
| QoQ Delta Rev Chg LTM | 2.7% |
| Op Inc Chg LTM | 6.1% |
| Op Inc Chg 3Y Avg | 85.2% |
| Op Mgn LTM | 12.3% |
| Op Mgn 3Y Avg | 11.1% |
| QoQ Delta Op Mgn LTM | -0.3% |
| CFO/Rev LTM | 15.4% |
| CFO/Rev 3Y Avg | 12.5% |
| FCF/Rev LTM | 13.9% |
| FCF/Rev 3Y Avg | 11.0% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 6.6 |
| P/S | 1.0 |
| P/Op Inc | 8.8 |
| P/EBIT | 6.6 |
| P/E | 9.4 |
| P/CFO | 7.7 |
| Total Yield | 7.5% |
| Dividend Yield | 1.5% |
| FCF Yield 3Y Avg | 11.0% |
| D/E | 0.3 |
| Net D/E | 0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | 3.2% |
| 3M Rtn | 7.8% |
| 6M Rtn | 8.5% |
| 12M Rtn | 13.9% |
| 3Y Rtn | 60.3% |
| 1M Excs Rtn | 0.9% |
| 3M Excs Rtn | 1.0% |
| 6M Excs Rtn | -5.7% |
| 12M Excs Rtn | -10.8% |
| 3Y Excs Rtn | -7.7% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Single Segment | 2,093 | 1,843 | 1,780 | 1,662 | 1,602 |
| Total | 2,093 | 1,843 | 1,780 | 1,662 | 1,602 |
| $ Mil | 2025 | 2024 | 2023 | 2022 |
|---|---|---|---|---|
| Single Segment | 255 | 235 | 171 | 71 |
| Total | 255 | 235 | 171 | 71 |
| $ Mil | 2025 | 2024 | 2023 | 2022 |
|---|---|---|---|---|
| Single Segment | 2,142 | 2,107 | 1,089 | 1,082 |
| Total | 2,142 | 2,107 | 1,089 | 1,082 |
Price Behavior
| Market Price | $83.91 | |
| Market Cap ($ Bil) | 5.9 | |
| First Trading Date | 10/01/2018 | |
| Distance from 52W High | -7.6% | |
| 50 Days | 200 Days | |
| DMA Price | $72.38 | $62.42 |
| DMA Trend | up | up |
| Distance from DMA | 15.9% | 34.4% |
| 3M | 1YR | |
| Volatility | 49.3% | 46.8% |
| Downside Capture | -20.06 | 39.71 |
| Upside Capture | 103.14 | 79.09 |
| Correlation (SPY) | 10.0% | 21.1% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.17 | 0.22 | 0.27 | 0.68 | 0.76 | 0.82 |
| Up Beta | -1.69 | -0.24 | 0.14 | 1.04 | 1.28 | 0.87 |
| Down Beta | -0.77 | -0.59 | -0.40 | 0.20 | 0.57 | 0.60 |
| Up Capture | 51% | 126% | 62% | 85% | 62% | 92% |
| Bmk +ve Days | 11 | 22 | 35 | 67 | 138 | 427 |
| Stock +ve Days | 10 | 27 | 35 | 68 | 136 | 391 |
| Down Capture | 152% | 17% | 50% | 59% | 66% | 96% |
| Bmk -ve Days | 11 | 21 | 28 | 59 | 114 | 326 |
| Stock -ve Days | 12 | 16 | 28 | 58 | 116 | 358 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with FTDR | |
|---|---|---|---|---|
| FTDR | 49.2% | 46.8% | 0.99 | - |
| Sector ETF (XLY) | 7.8% | 19.4% | 0.26 | 29.8% |
| Equity (SPY) | 23.4% | 12.8% | 1.37 | 20.7% |
| Gold (GLD) | 28.7% | 28.4% | 0.88 | 4.1% |
| Commodities (DBC) | 37.2% | 20.1% | 1.46 | -19.5% |
| Real Estate (VNQ) | 12.4% | 13.8% | 0.60 | 31.8% |
| Bitcoin (BTCUSD) | -44.9% | 43.0% | -1.27 | 5.1% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with FTDR | |
|---|---|---|---|---|
| FTDR | 10.6% | 39.7% | 0.36 | - |
| Sector ETF (XLY) | 6.6% | 24.0% | 0.23 | 37.5% |
| Equity (SPY) | 13.5% | 17.2% | 0.61 | 35.7% |
| Gold (GLD) | 18.9% | 18.6% | 0.83 | 4.1% |
| Commodities (DBC) | 9.2% | 19.6% | 0.36 | 0.5% |
| Real Estate (VNQ) | 2.1% | 18.9% | 0.01 | 34.9% |
| Bitcoin (BTCUSD) | 10.6% | 52.9% | 0.39 | 14.2% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with FTDR | |
|---|---|---|---|---|
| FTDR | 7.1% | 41.1% | 0.35 | - |
| Sector ETF (XLY) | 12.5% | 22.2% | 0.52 | 37.1% |
| Equity (SPY) | 15.4% | 17.9% | 0.73 | 36.3% |
| Gold (GLD) | 12.1% | 16.2% | 0.61 | 1.9% |
| Commodities (DBC) | 7.7% | 18.1% | 0.34 | 6.7% |
| Real Estate (VNQ) | 4.6% | 20.7% | 0.18 | 34.2% |
| Bitcoin (BTCUSD) | 58.3% | 66.2% | 0.98 | 9.6% |
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Returns Analyses
Earnings Returns History
Updated 8/11/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 8/6/2026 | 17.7% | ||
| 4/30/2026 | 13.3% | 9.1% | 2.4% |
| 2/26/2026 | 16.8% | 20.6% | -0.8% |
| 11/5/2025 | -15.9% | -21.5% | -19.3% |
| 8/5/2025 | -4.0% | -4.2% | 6.3% |
| 5/1/2025 | 13.2% | 28.9% | 33.8% |
| 11/4/2024 | 6.9% | 17.9% | 18.0% |
| 8/1/2024 | 12.8% | 11.1% | 20.5% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 13 |
| # Negative | 9 | 10 | 10 |
| Median Positive | 12.6% | 11.1% | 12.8% |
| Median Negative | -8.4% | -9.0% | -12.2% |
| Max Positive | 17.7% | 28.9% | 33.8% |
| Max Negative | -15.9% | -21.5% | -19.8% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 8/6/2026 | 17.7% | ||
| 4/30/2026 | 13.3% | 9.1% | 2.4% |
| 2/26/2026 | 16.8% | 20.6% | -0.8% |
| 11/5/2025 | -15.9% | -21.5% | -19.3% |
| 8/5/2025 | -4.0% | -4.2% | 6.3% |
| 5/1/2025 | 13.2% | 28.9% | 33.8% |
| 11/4/2024 | 6.9% | 17.9% | 18.0% |
| 8/1/2024 | 12.8% | 11.1% | 20.5% |
| 5/2/2024 | 10.6% | 17.4% | 15.0% |
| 2/28/2024 | -5.8% | -8.7% | -2.2% |
| 11/1/2023 | 15.1% | 23.0% | 18.7% |
| 8/2/2023 | 5.7% | 1.9% | -5.2% |
| 5/4/2023 | 12.6% | 15.6% | 19.5% |
| 3/1/2023 | 5.3% | -1.1% | -2.9% |
| 11/3/2022 | 16.8% | 10.9% | 12.8% |
| 8/4/2022 | -4.4% | -2.3% | -12.7% |
| 5/5/2022 | -10.3% | -10.5% | -19.8% |
| 2/24/2022 | -8.4% | -10.3% | -13.6% |
| 10/28/2021 | -10.9% | -9.3% | -16.0% |
| 8/4/2021 | -11.6% | -10.3% | -11.8% |
| 5/6/2021 | 3.4% | 2.1% | 3.2% |
| 2/18/2021 | -0.8% | -7.1% | 0.3% |
| 11/4/2020 | 2.7% | 4.1% | 7.8% |
| 8/5/2020 | 11.0% | 8.0% | 9.3% |
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 13 |
| # Negative | 9 | 10 | 10 |
| Median Positive | 12.6% | 11.1% | 12.8% |
| Median Negative | -8.4% | -9.0% | -12.2% |
| Max Positive | 17.7% | 28.9% | 33.8% |
| Max Negative | -15.9% | -21.5% | -19.8% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/06/2026 | 10-Q |
| 03/31/2026 | 04/30/2026 | 10-Q |
| 12/31/2025 | 02/26/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/05/2025 | 10-Q |
| 03/31/2025 | 05/01/2025 | 10-Q |
| 12/31/2024 | 02/27/2025 | 10-K |
| 09/30/2024 | 11/04/2024 | 10-Q |
| 06/30/2024 | 08/01/2024 | 10-Q |
| 03/31/2024 | 05/02/2024 | 10-Q |
| 12/31/2023 | 02/28/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/02/2023 | 10-Q |
| 03/31/2023 | 05/04/2023 | 10-Q |
| 12/31/2022 | 03/01/2023 | 10-K |
| 09/30/2022 | 11/03/2022 | 10-Q |
| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/06/2026 | 10-Q |
| 03/31/2026 | 04/30/2026 | 10-Q |
| 12/31/2025 | 02/26/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/05/2025 | 10-Q |
| 03/31/2025 | 05/01/2025 | 10-Q |
| 12/31/2024 | 02/27/2025 | 10-K |
| 09/30/2024 | 11/04/2024 | 10-Q |
| 06/30/2024 | 08/01/2024 | 10-Q |
| 03/31/2024 | 05/02/2024 | 10-Q |
| 12/31/2023 | 02/28/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/02/2023 | 10-Q |
| 03/31/2023 | 05/04/2023 | 10-Q |
| 12/31/2022 | 03/01/2023 | 10-K |
| 09/30/2022 | 11/03/2022 | 10-Q |
| 06/30/2022 | 08/04/2022 | 10-Q |
| 03/31/2022 | 05/06/2022 | 10-Q |
| 12/31/2021 | 02/25/2022 | 10-K |
| 09/30/2021 | 10/29/2021 | 10-Q |
| 06/30/2021 | 08/04/2021 | 10-Q |
| 03/31/2021 | 05/06/2021 | 10-Q |
| 12/31/2020 | 02/23/2021 | 10-K |
| 09/30/2020 | 11/05/2020 | 10-Q |
| 06/30/2020 | 08/06/2020 | 10-Q |
| 03/31/2020 | 05/07/2020 | 10-Q |
| 12/31/2019 | 02/28/2020 | 10-K |
| 09/30/2019 | 11/06/2019 | 10-Q |
Recent Forward Guidance
Updated 8/7/2026Latest: Q2 2026 Earnings Reported 8/6/2026
| Forward Guidance | Guidance Change | ||||||
|---|---|---|---|---|---|---|---|
| Metric | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q3 2026 Revenue | 642.00 Mil | 647.00 Mil | 652.00 Mil | ||||
| Q3 2026 Adjusted EBITDA | 197.00 Mil | 202.00 Mil | 207.00 Mil | ||||
| 2026 Revenue | 2.19 Bil | 2.20 Bil | 2.21 Bil | 1.1% | Raised | Guidance: 2.17 Bil for 2026 | |
| 2026 Adjusted EBITDA | 585.00 Mil | 592.50 Mil | 600.00 Mil | 3.5% | Raised | Guidance: 572.50 Mil for 2026 | |
| 2026 Adjusted EBITDA Margin | 27.0% | ||||||
| 2026 Capital Expenditures | 30.00 Mil | -7.7% | Lowered | Guidance: 32.50 Mil for 2026 | |||
Prior: Q4 2025 Earnings Reported 2/26/2026
| Forward Guidance | Guidance Change | ||||||
|---|---|---|---|---|---|---|---|
| Metric | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q1 2026 Revenue | 440.00 Mil | 442.50 Mil | 445.00 Mil | 5.4% | Higher New | Guidance: 420.00 Mil for Q4 2025 | |
| Q1 2026 Adjusted EBITDA | 95.00 Mil | 100.00 Mil | 105.00 Mil | 90.5% | Higher New | Guidance: 52.50 Mil for Q4 2025 | |
| 2026 Revenue | 2.15 Bil | 2.17 Bil | 2.19 Bil | 4.6% | Higher New | Guidance: 2.08 Bil for 2025 | |
| 2026 Adjusted EBITDA | 565.00 Mil | 572.50 Mil | 580.00 Mil | 4.6% | Higher New | Guidance: 547.50 Mil for 2025 | |
| 2026 Gross Profit Margin | 54.0% | 54.5% | 55.0% | -1.0% | Lower New | Guidance: 55.5% for 2025 | |
| 2026 Capital Expenditures | 30.00 Mil | 32.50 Mil | 35.00 Mil | 8.3% | Higher New | Guidance: 30.00 Mil for 2025 | |
Q4 2025 Earnings Reported 2/26/2026
| Forward Guidance | Guidance Change | ||||||
|---|---|---|---|---|---|---|---|
| Metric | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q1 2026 Revenue | 440.00 Mil | 442.50 Mil | 445.00 Mil | 5.4% | Higher New | Guidance: 420.00 Mil for Q4 2025 | |
| Q1 2026 Adjusted EBITDA | 95.00 Mil | 100.00 Mil | 105.00 Mil | 90.5% | Higher New | Guidance: 52.50 Mil for Q4 2025 | |
| 2026 Revenue | 2.15 Bil | 2.17 Bil | 2.19 Bil | 4.6% | Higher New | Guidance: 2.08 Bil for 2025 | |
| 2026 Adjusted EBITDA | 565.00 Mil | 572.50 Mil | 580.00 Mil | 4.6% | Higher New | Guidance: 547.50 Mil for 2025 | |
| 2026 Gross Profit Margin | 54.0% | 54.5% | 55.0% | -1.0% | Lower New | Guidance: 55.5% for 2025 | |
| 2026 Capital Expenditures | 30.00 Mil | 32.50 Mil | 35.00 Mil | 8.3% | Higher New | Guidance: 30.00 Mil for 2025 | |
Q3 2025 Earnings Reported 11/5/2025
| Forward Guidance | Guidance Change | ||||||
|---|---|---|---|---|---|---|---|
| Metric | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q4 2025 Revenue | 415.00 Mil | 420.00 Mil | 425.00 Mil | ||||
| Q4 2025 Adjusted EBITDA | 50.00 Mil | 52.50 Mil | 55.00 Mil | ||||
| 2025 Revenue | 2.08 Bil | 2.08 Bil | 2.08 Bil | 0.7% | Raised | Guidance: 2.06 Bil for 2025 | |
| 2025 Adjusted EBITDA | 545.00 Mil | 547.50 Mil | 550.00 Mil | 1.4% | Raised | Guidance: 540.00 Mil for 2025 | |
| 2025 Gross Profit Margin | 55.5% | 0.0% | Affirmed | Guidance: 55.5% for 2025 | |||
| 2025 SG&A | 670.00 Mil | 672.50 Mil | 675.00 Mil | ||||
| 2025 Capital Expenditures | 30.00 Mil | Lowered | |||||
| 2025 Annual Effective Tax Rate | 25.0% | ||||||
Insider Activity
Updated 7/16/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Fiarman, Jeffrey | SVP & Chief Legal Officer | Direct | Sell | 3042026 | 67.60 | 15,000 | 1,014,024 | 1,338,917 | Form |
| 2 | Collins, Kathryn M | SVP & Chief Revenue Officer | Direct | Sell | 8192025 | 59.02 | 9,429 | 556,484 | 577,377 | Form |
| 3 | Fiarman, Jeffrey | SVP, CLO & Secretary | Direct | Sell | 8112025 | 56.15 | 129,673 | 7,280,568 | 1,945,220 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Fiarman, Jeffrey | SVP & Chief Legal Officer | Direct | Sell | 3042026 | 67.60 | 15,000 | 1,014,024 | 1,338,917 | Form |
| 2 | Collins, Kathryn M | SVP & Chief Revenue Officer | Direct | Sell | 8192025 | 59.02 | 9,429 | 556,484 | 577,377 | Form |
| 3 | Fiarman, Jeffrey | SVP, CLO & Secretary | Direct | Sell | 8112025 | 56.15 | 129,673 | 7,280,568 | 1,945,220 | Form |
Investor Activity (13F)
Updated Aug 11, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager |
|---|
FTDR Trade Sentinel
Constructive
CONVICTION RATIONALE
Conviction is constructive, centered on a clear operational inflection. The company just posted its first organic member growth in five years, driven by pricing power and share gains. While new competition is a risk, high customer retention and raised financial guidance suggest the business momentum is durable.
STOCK ARCHETYPE
Recurring Revenue / Subscription Service(Number of Members) x (Average Price per Member) + (Non-Warranty & Other Revenue) Margin expansion driven by dynamic pricing, operational efficiencies in claims and contractor management, and SG&A leverage as revenue scales.
INVESTMENT THESIS
Evidence suggests a successful pivot from stabilization to growth, underpinning a higher valuation.
- Total member count grew 1% YoY, the first organic growth in five years.
- The direct-to-consumer channel grew 5% and the real estate channel grew 7%.
- Customer retention remains high and stable at 79.6%.
- Full-year 2026 revenue and adjusted EBITDA guidance were both raised.
- The company expects to buy back approximately $330 million of shares in 2026.
PRIMARY RISK
Well-capitalized entrants like Assurant could pressure pricing and market share, particularly in the real estate channel, stalling the new growth trajectory.
- An analyst report in June 2026 highlighted competitive threats from Assurant.
- The home warranty industry is described in filings as highly competitive.
- Peer First American Financial reported faster TTM revenue growth.
- Promotional pricing is used as a strategic tool to acquire new customers.
| KPI | Status | Rationale |
|---|---|---|
| Total Ending Member Count Growth | 1% year-over-year growth for Q2 2026 - Turning around | The return to positive year-over-year growth marks a major turnaround for the company. Management attributes this to strong execution in both the direct-to-consumer channel, which grew 5%, and the real estate channel, which grew 7%, against a backdrop of a still-sluggish housing market. |
| Customer Retention Rate | 79.6% for Q2 2026 - Stable | Management attributes the consistently high retention to an improved member experience, driven by technology like the company's app and video chat support, as well as operational improvements such as a high rate of autopay enrollment (85%) and strong usage of its preferred contractor network. |
| Renewal Revenue | 76% of total revenue (For the year 2025) | Highlights the highly recurring and predictable nature of the business model, as the vast majority of revenue comes from existing customers choosing to renew their annual contracts. |
Growth Inflection vs. Competitive Threat
BULL VIEW
Bulls believe the 1% member growth inflection is durable, proving the company's scale and execution can win share even against new entrants in a tough housing market.
CORE TENSION
Can the 1% member growth, fueled by a 30 basis point attach rate improvement, overcome the threat from new, well-capitalized competitors?
PREVAILING SENTIMENT
The latest evidence favors the bulls. The company is delivering member growth and raising guidance, while the competitive threat remains a forward-looking risk not yet visible in the core KPIs.
BEAR VIEW
Bears argue the entry of large competitors like Assurant will force a price war, making the recent 7% growth in the real estate channel unsustainable.
| Timeline | Event & Metric To Watch |
|---|---|
10/21/2026 | Peer Weakness Signals Market Slowdown Watch: Deceleration in revenue growth or margin pressure at FAF or ORI, particularly in their residential-facing segments. |
11/2/2026 | Peer Earnings Report Watch: Peer Angi (ANGI) is scheduled to report earnings. |
11/3/2026 | Earnings Miss on High Expectations Watch: Any miss on revenue or adjusted EBITDA guidance, or margin compression from the guided weather reversal. |
No set date | Competitive Pressure Materializes Watch: Commentary from peers on market share shifts, pricing pressure, or new product offerings during their earnings calls. |
| Date | Event | Stock Impact |
|---|---|---|
2026-08-06 | Q2 2026 Results and Guidance Raise Details: The company reported Q2 revenue increased 5% to $645 million and raised its full-year 2026 guidance for both Revenue and Adjusted EBITDA. | +18.9% $76.38 -> $90.83 |
2026-06-30 | Analyst Note Highlights Competition Details: An analyst report noted that while the business is strong, competitive threats, notably from Assurant, warrant caution, leading to a rating downgrade. | +3.2% $76.03 -> $78.44 |
2026-06-29 | New Board Member Appointed Details: The company expanded its board to nine and elected Hilla Sferruzza as a director, who will also serve on the Audit Committee. | +3.8% $74.73 -> $77.59 |
2026-04-30 | Q1 2026 Results Announced Details: The company reported continued strong financial performance, with revenue growing 6% to $451 million. The stock's two-day reaction was +14.0%. | +13.6% $60.59 -> $68.80 |
2026-03-31 | Warrantina Campaign Relaunched Details: The company announced the third year of its 'Don't Worry. Be Warranty.' marketing campaign featuring Rachel Dratch as 'Warrantina'. | +4.9% $51.95 -> $54.52 |
2026-02-26 | Q4 and Full-Year 2025 Results Details: The company announced record full-year 2025 results. The stock had a two-day reaction of +22.0% around the earnings call. | +21.8% $56.30 -> $68.57 |
Position Sizing
4% - 6%
NORMAL POSITION
Sizing is volatility-based: FTDR trades at roughly 33% annualized options-implied volatility versus about 13% for the S&P 500 (2.5x the market), around the 31st percentile of its own trailing year. A 4% - 6% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
FAF - First American Financial
Diversified Financial ExposureFAF offers exposure to the broader title insurance and settlement services market, which is much larger than the home warranty category, providing different cyclical drivers.
ANGI - Angi
On-Demand Service ModelAngi operates an on-demand marketplace model, contrasting with Frontdoor's subscription service. This offers exposure to consumers who prefer transactional, non-recurring home service solutions.
A recurring-revenue service provider monetizing the friction of home repair, which has successfully pivoted from stabilization to organic customer growth while layering on a capital-light, high-synergy services business.
Frontdoor is the leader in the U.S. home warranty market, built on a highly predictable renewal base that accounts for over three-quarters of its revenue. After a multi-year turnaround focused on operational efficiency and margin expansion, the company has inflected to organic customer growth for the first time in five years. It is now executing a dual-engine growth strategy: driving its core warranty business while rapidly scaling a non-warranty services platform (e.g., HVAC upgrades) to its 2.1 million members with minimal acquisition cost.
Sustained year-over-year growth in total member count, continued high retention rates 79.6%, and profitable scaling of non-warranty services into new trades like appliances.
A reversal of the recent member growth trend, a decline in retention rates, or evidence that new competition is successfully taking market share and pressuring prices.
Quarterly fluctuations in claims costs due to weather seasonality, which management has indicated can be a timing issue between quarters.
Repricing Catalyst
The company's return to organic member growth in Q2 2026 for the first time in five years, combined with a significant beat on earnings and a raised full-year revenue and EBITDA guidance.
Single Segment
$2.1B TTM (100% of Total)What It Is
Sells home warranties to homeowners through direct-to-consumer (DTC) and real estate channels under brands like American Home Shield and 2-10 HBW. Also sells new home builder warranties to builders and non-warranty services (e.g., HVAC upgrades, Moen smart water device installations) primarily to its existing warranty customer base.
Who Pays & How
Homeowners pay for annual contracts to mitigate the financial risk and hassle of unexpected breakdowns of home systems and appliances. The company handles approximately 3.8 million service requests annually, providing customers with budget protection and access to a network of 17,000 qualified contractors.
Competition
Industry Resources
| Consumer Discretionary Resources |
| Retail Dive |
| Business of Fashion (BoF) |
| WWD (Women's Wear Daily) |
| National Retail Federation (NRF) |
| McKinsey & Company - Consumer |
| Mintel Consumer Trends |
| Specialized Consumer Services Resources |
| Consumer Reports |
| Better Business Bureau (BBB) |
| TrendWatching |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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