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Mitek Systems (MITK)
:MITK
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Mitek Systems
(NASDAQ:MITK)
76Outperform
Positive Factors
Financial Performance
Mitek reported F2Q25 results with revenue of $51.9M, up 11% year-over-year, and adjusted EBITDA of $20.2M, up 52% year-over-year, beating estimates due to better-than-expected performance in SaaS revenue, the Deposits segment, and expense control.
Product Adoption
Adoption of Mitek's broader MiVIP platform is trending nicely as more organizations implement multistep identity verification protocols, driving more revenue per customer journey.
Strategic Initiatives
The company announced a new term loan intended to replace outstanding convertible debt, potentially allowing for accelerated share repurchase activity or accretive M&A.
Negative Factors
Revenue Growth Concerns
Revenue growth is likely to result in muted revenue growth in FY25.
Segment Performance
As for mobile deposit, while segment revenue declined by 9% during the quarter, management noted this was largely due to the timing of deals.
Mitek Systems (MITK) vs. S&P 500 (SPY)
Market Cap
$445.16M
Dividend YieldN/A
Average Volume (3M)448.36K
Price to Earnings (P/E)34.5
Beta (1Y)0.93
Revenue Growth7.76%
EPS GrowthN/A
CountryUS
Employees565
SectorTechnology
Sector Strength80
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.36
Shares Outstanding45,564,205
10 Day Avg. Volume529,764
30 Day Avg. Volume448,355
Financial Highlights & Ratios
PEG Ratio0.31
Price to Book (P/B)2.19
Price to Sales (P/S)0.00
P/FCF Ratio10.97
Enterprise Value/Market Cap1.12
Enterprise Value/Revenue0.74
Enterprise Value/Gross Profit3.14
Enterprise Value/Ebitda5.71
Forecast
1Y Price Target
$14.00Price Target Upside43.30% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Mitek Systems Business Overview & Revenue Model
Company DescriptionMitek Systems, Inc. is a leader in digital identity verification and mobile capture solutions. The company operates primarily within the technology sector, offering advanced software solutions that enable businesses to verify identities and authenticate transactions using mobile and web devices. Mitek's technology is widely used in the financial services sector, helping institutions reduce fraud, streamline processes, and enhance customer experiences.
How the Company Makes MoneyMitek Systems generates revenue primarily through the sale of its software solutions and services. The company's key revenue streams include licensing fees for its identity verification and mobile capture technologies, as well as subscription fees for ongoing access to its software as a service (SaaS) offerings. Additionally, Mitek earns revenue from implementation services, support, and maintenance contracts. The company benefits from partnerships with financial institutions, technology providers, and other enterprises that integrate Mitek's solutions into their own offerings, expanding the reach and application of its technologies.
Mitek Systems Financial Statement Overview
Summary
Mitek Systems demonstrates strong revenue growth and robust cash flow generation, supported by a solid balance sheet. However, the company faces challenges in improving profitability and return on equity, which slightly tempers its financial performance score.Income Statement
Mitek Systems shows consistent revenue growth with a 20.3% increase from 2022 to 2023, driven by strong gross profit margins consistently above 90%. However, the net profit margin remains modest at 2.6% TTM, indicating room for profitability improvement. EBIT and EBITDA margins have decreased slightly, reflecting some operational challenges.72
Positive
Balance Sheet
The company maintains a solid balance sheet with an equity ratio of 50.7% TTM, indicating financial stability. The debt-to-equity ratio stands at 0.74, reflecting manageable leverage levels. Return on equity is relatively low at 2.2% TTM, suggesting a need for better utilization of equity capital.75
Positive
Cash Flow
Mitek Systems demonstrates robust cash flow generation, with a significant increase in free cash flow by 32.2% TTM. The operating cash flow to net income ratio of 9.36 suggests strong cash conversion efficiency. The company's ability to generate cash is a key strength, supporting future growth and debt reduction.80
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 172.42M | 172.08M | 172.55M | 143.94M | 119.80M | 101.31M | Gross Profit |
| 159.07M | 171.77M | 149.60M | 123.94M | 105.26M | 88.12M | EBIT |
| 10.65M | 2.23M | 15.56M | 27.57M | 13.71M | 8.87M | EBITDA |
| 28.14M | 26.96M | 39.62M | 28.08M | 24.07M | 18.15M | Net Income Common Stockholders |
| 4.46M | 3.28M | 8.03M | 3.69M | 7.98M | 7.81M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 123.93M | 130.34M | 133.61M | 90.33M | 179.37M | 60.02M | Total Assets |
| 417.03M | 413.75M | 405.38M | 360.41M | 419.28M | 169.15M | Total Debt |
| 145.45M | 148.64M | 140.28M | 134.19M | 129.45M | 7.15M | Net Debt |
| 64.51M | 55.18M | 81.37M | 102.13M | 99.14M | -12.84M | Total Liabilities |
| 200.88M | 198.95M | 200.19M | 190.09M | 226.02M | 36.91M | Stockholders Equity |
| 216.15M | 214.80M | 205.19M | 170.32M | 193.26M | 132.24M |
| Cash Flow | Free Cash Flow | ||||
| 40.18M | 30.25M | 30.55M | 25.23M | 35.95M | 23.32M | Operating Cash Flow |
| 41.72M | 31.69M | 31.59M | 26.35M | 37.34M | 24.12M | Investing Cash Flow |
| 11.70M | 28.75M | -6.78M | -3.53M | -170.49M | -24.71M | Financing Cash Flow |
| -25.90M | -25.88M | 1.70M | -21.14M | 143.68M | 3.40M |
Mitek Systems Technical Analysis
Positive
9.77
Price Trends
8.52
Positive
9.37
Positive
9.27
Positive
Market Momentum
0.39
Negative
70.60
Negative
46.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MITK, the sentiment is Positive. The current price of 9.77 is above the 20-day moving average (MA) of 8.70, above the 50-day MA of 8.52, and above the 200-day MA of 9.27, indicating a bullish trend. The MACD of 0.39 indicates Negative momentum. The RSI at 70.60 is Negative, neither overbought nor oversold. The STOCH value of 46.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MITK.
Mitek Systems Risk Analysis
Mitek Systems disclosed 35 risk factors in its most recent earnings report. Mitek Systems reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Mitek Systems Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $445.16M | 34.55 | 6.11% | ― | 7.76% | ― | |
73 Outperform | $1.05B | 50.49 | -47.39% | ― | 3.82% | -251.96% | |
63 Neutral | $1.32B | ― | -6.49% | ― | 5.15% | 28.27% | |
61 Neutral | $176.91M | ― | -27.44% | ― | 16.03% | 30.99% | |
60 Neutral | $11.62B | 10.48 | -7.27% | 2.93% | 7.46% | -10.64% | |
54 Neutral | $618.72M | ― | -46.57% | ― | -2.39% | -2961.26% | |
51 Neutral | $162.21M | ― | -22.66% | ― | -25.43% | -135.09% |
* Technology Sector Average
Performance Comparison
MITK
Mitek Systems
9.77
-3.17
-24.50%
OPFI
OppFi
11.81
8.58
265.63%
FRGE
Forge Global Holdings
14.35
-14.15
-49.65%
SMRT
SmartRent
0.86
-1.73
-66.80%
BMBL
Bumble
5.77
-6.44
-52.74%
MLNK
MeridianLink
17.06
-1.79
-9.50%
Mitek Systems Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q2-2025)
| % Change Since: 10.90%|
Next Earnings Date:Jul 24, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment with strong revenue growth, increased SaaS adoption, and expanded data coverage for Check Fraud Defender. However, some caution remains due to macroeconomic uncertainties and slower growth in the identity segment.Q2-2025 Updates
Positive Updates
Record Revenue Growth
Total revenue reached a record $51.9 million, up 11% year-over-year in the second quarter.
SaaS Revenue Increase
SaaS revenue grew 15% year-over-year in Q2 and now accounts for 40% of total last 12 months revenue, up from 39% last quarter.
Check Fraud Defender Expansion
Check Fraud Defender now has data sets on 23% of U.S. checking accounts, up from 18% last quarter.
Improved Identity Portfolio Performance
Identity portfolio revenue reached $71.4 million in the last 12 months, driven by strong transaction growth and a 9% increase in identity SaaS revenue.
Increased EBITDA and Free Cash Flow
Adjusted EBITDA was $20.2 million, representing a 39% margin, and the company generated $47 million in free cash flow over the last 12 months.
Negative Updates
Macro Environment Caution
Management remains cautious about potential macroeconomic headwinds despite not seeing any cancellations tied to the macro backdrop.
Identity Revenue Growth Rate
Identity products revenue increased by only 4% year-over-year, indicating a slower growth rate compared to other segments.
Lumpiness in Term License Revenue
Due to the lumpiness inherent to term license revenue, which makes up 70% of deposits products revenue, management urges focus on longer-term trends.
Company Guidance
During Mitek's Fiscal 2025 Second Quarter Earnings Conference Call, several key metrics and forward-looking statements were discussed. The company reported a record total revenue of $51.9 million for the quarter, marking an 11% increase year-over-year. Mitek's identity portfolio reached over $71 million in revenue over the last 12 months, driven by strong transaction growth. The Check Fraud Defender product expanded its data set coverage to approximately 23% of U.S. checking accounts, up from 18% in the previous quarter. Additionally, Mitek reported a 15% year-over-year growth in SaaS revenue, now accounting for 40% of the total revenue. The company's non-GAAP gross profit was $45.6 million, representing an 88% gross margin, while adjusted EBITDA was $20.2 million, corresponding to a 39% margin. Mitek also generated $47 million in free cash flow over the last 12 months, highlighting its financial discipline and strategic focus on organic growth, SaaS revenue increase, margin expansion, and free cash flow conversion.Mitek Systems Corporate Events
Private Placements and FinancingFinancial Disclosures
Mitek Systems Secures $75M Loan with SVB
Positive
May 8, 2025
On May 7, 2025, Mitek Systems announced an amendment to its existing credit facility with Silicon Valley Bank, establishing a $75 million term loan and a revised $25 million revolving line of credit. This financial maneuver aims to retire the company’s outstanding Convertible Notes by February 2026, securing financial flexibility and supporting Mitek’s strong balance sheet. Additionally, Mitek reported record financial results for the second quarter of fiscal 2025, with an 11% year-over-year revenue increase to $51.9 million and a significant rise in GAAP net income. The company also raised its adjusted EBITDA margin guidance for fiscal 2025, reflecting its robust performance and strategic focus on long-term growth.
Spark’s Take on MITK Stock
According to Spark, TipRanks’ AI Analyst, MITK is a Outperform.
Mitek Systems shows solid financial health with strong revenue and cash flow growth, supported by strategic initiatives in identity and SaaS. However, high valuation and technical analysis suggest caution. The overall score reflects a balanced view of current strengths and challenges.
To see Spark’s full report on MITK stock, click here.
Executive/Board ChangesBusiness Operations and Strategy
Mitek Systems Appoints Garrett Gafke as COO
Positive
Apr 28, 2025
On April 25, 2025, Mitek Systems appointed Garrett Gafke as Chief Operating Officer to drive growth and innovation. Gafke, a seasoned executive in identity, fraud, and payments markets, is expected to enhance Mitek’s operations and solidify its position as a leader in digital identity verification and fraud prevention. His compensation package is heavily performance-based, aligning his incentives with shareholder value creation.
Spark’s Take on MITK Stock
According to Spark, TipRanks’ AI Analyst, MITK is a Neutral.
Mitek Systems demonstrates strong financial health and promising strategic initiatives, particularly in identity and SaaS revenue growth. However, the stock faces challenges with profitability, valuation concerns, and technical bearish signals, necessitating caution. Positive earnings call sentiment and strategic focus on innovation offer potential upside.
To see Spark’s full report on MITK stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.