MITK - Mitek Systems: Growth Re-Acceleration Likely Around The Corner

2024-05-21 10:36:29 ET

Summary

• The perception that the mobile deposit market is declining is inaccurate, as deposit volumes are growing. Mitek's introduction of Check Fraud Defender is expected to drive further growth.
• Its identity verification business is undergoing a turnaround, as legacy products are undergoing enhancement to improve margins, and newer ones are expected to re-accelerate its growth.
• The risk of potential delisting from NASDAQ is no longer a concern.
• MITK is poised to re-accelerate growth and regain profitability in FY25.
• Considering MITK's improving fundamentals and my valuation indicating a 12% upside, I am rating it as a buy.

Brief Overview of Mitek Systems

Mitek Systems ( MITK ) has 2 main business segments:

1) Mobile Deposit: Mitek is a market leader in mobile check deposits. Its solution is integrated into the digital banking apps of over 7,900 financial institutions globally, enabling users to scan and deposit their checks digitally....

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