Mitek Systems (MITK) recently reported its fiscal 2024 Q2 results, showing a 1.8% year-over-year increase in revenue to $47 million. This growth was driven by demand for the company’s new MiVIP, MiPass, and ID R&D biometrics identity products. While this result was at the high end of its guidance range and above expectations, adjusted earnings of 24 cents per share were down 20% due to fees associated with delayed SEC filings. Despite these costs, MITK was able to generate $6.8 million in free cash flow, up 8.2% from the previous year, and reduce its net debt to $9.2 million.
As MITK is now up to date on its regulatory filings, the extra fees should not be a recurring issue. Additionally, recent product innovations are gaining market acceptance, which bodes well for meeting performance targets. The company maintained full-year revenue guidance of $180 million to $185 million and a 30%-31% adjusted operating margin target. This suggests a promising outlook for top-line growth acceleration and a rebound in earnings expansion in the second half of the year. MITK also announced a $50 million stock repurchase program over the next two years, indicating confidence in its future performance.
Investors looking for undervalued opportunities with significant upside may find MITK to be a compelling stock to consider. Forbes Investor newsletter has recommended MITK as one of their picks, alongside other promising investment opportunities. With the potential for the shares to rebound following the recent post-earnings decrease of more than 10%, it could be an attractive option for those seeking growth potential in the market. Julius Juenemann, CFA, equity analyst and associate editor at Forbes Special Situation Survey and Forbes Investor, provides insights on MITK and other recommended stocks through the newsletter.
For those interested in accessing recommendations like MITK and staying informed on market opportunities, subscribing to Forbes Investor can provide valuable insights. With a focus on identifying undervalued gems with substantial upside, the newsletter offers a comprehensive approach to investment strategies. As MITK continues to navigate the market landscape with its innovative products and growth targets, investors may find opportunities for future returns and stock performance. Keep abreast of developments in the sector by following Julius Juenemann and staying informed about investment opportunities through Forbes Investor.
