One-glance verdict
Undervalued
$39.81 our estimate vs market $17.14
Wall Street consensus: $22.62 (-43.2% lower than our fair-value estimate)
57% below our estimate, below the bear case
Fundamentals snapshot
Mitek Systems, Inc.
MITK · NCM · Technology · Software - Application
Current price
$17.14
52-week range
$8.53 - $21.05
Market cap
$773.40M
Balance sheet
Healthy
1.80x Concerning
Net cash $43.54M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 10.1% last year.
- Reward Returns 9.2% on equity, ahead of 40% of its peers.
- Reward Free cash flow was positive in 10/10 years.
What this company does
Mitek Systems, Inc.
Mitek Systems creates the software that allows you to deposit a check by taking a picture with your phone and also helps banks verify customer identities to prevent online fraud. The company makes most of its money by licensing its software to financial businesses, which often creates recurring revenue (predictable income from ongoing subscriptions or contracts). This is important because as more of our financial lives move online, the need for secure and convenient identity verification becomes essential.
How the company got here
Mitek Systems started in 1986 with a focus on software that could recognize images and text. A major turning point came in the late 2000s when it pioneered Mobile Deposit, the technology that lets you deposit a check by taking a picture of it with your smartphone. This made the company a key partner for thousands of banks. Seeing a growing need for online security, Mitek then expanded by acquiring several companies focused on verifying people's digital identities, transforming itself into a broader fraud prevention and identity verification company.
What it actually does
Mitek creates software that banks and other businesses build into their own mobile apps and websites. You've likely used Mitek's technology if you've ever deposited a check using your phone's camera. It also provides technology that verifies you are who you say you are when you're opening a new bank account or logging in online. This involves confirming your driver's license or passport is real and sometimes matching a selfie to the photo on your ID to prevent fraud.
Deposit Solutions
This is Mitek's original and well-established business that provides the technology for mobile check deposits. Financial institutions like banks and credit unions pay Mitek to use its software, which includes the MiSnap feature that automatically captures a clear image of the check. This segment also includes newer products like Check Fraud Defender, which helps banks detect fraudulent checks. While this is a mature part of the company, it provides a steady, reliable stream of revenue.
Identity Verification
This is Mitek's faster-growing business, now making up more than half of the company's revenue. Companies pay Mitek to verify the identity of their customers during online interactions, like when someone is opening a new account. The technology can check if an ID document is authentic and use biometrics (like a face scan) to confirm the person is real and present. This helps businesses prevent fraud and comply with regulations known as Know Your Customer (KYC) rules.
What management is betting on now
Management's current strategy is called 'Unify and Grow.' The goal is to combine its separate identity verification and fraud prevention tools into a single, more complete platform for businesses. They are focused on growing their software-as-a-service (SaaS) revenue, which means customers pay a recurring subscription fee rather than a one-time license. The company is also investing in artificial intelligence to stay ahead of new fraud methods like deepfakes and synthetic identity fraud (where a criminal creates a fake identity).
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$20.82M
FY2025 Q1
$230.00K
FY2025 Q2
$13.51M
FY2025 Q3
$21.24M
FY2025 Q4
$19.20M
FY2026 Q1
$6.59M
FY2026 Q2
$-2.50M
FY2026 Q3
$25.32M
Revenue
$54.04M
Net income
$8.37M
Diluted EPS
0.17
Operating cash flow
$27.16M
Free cash flow
$25.32M
Fetching…
Sources
Revenue
$54.84M
Net income
$9.54M
Diluted EPS
0.20
Operating cash flow
$-945.00K
Free cash flow
$-2.50M
Fetching…
Sources
Revenue
$44.24M
Net income
$2.77M
Diluted EPS
0.06
Operating cash flow
$8.02M
Free cash flow
$6.59M
Fetching…
Sources
Revenue
$44.78M
Net income
$1.86M
Diluted EPS
0.04
Operating cash flow
$19.46M
Free cash flow
$19.20M
Fetching…
Sources
Revenue
$45.73M
Net income
$2.40M
Diluted EPS
0.05
Operating cash flow
$21.57M
Free cash flow
$21.24M
Fetching…
Sources
Revenue
$51.93M
Net income
$9.15M
Diluted EPS
0.20
Operating cash flow
$13.74M
Free cash flow
$13.51M
Fetching…
Sources
Revenue
$37.25M
Net income
$-4.61M
Diluted EPS
-0.10
Operating cash flow
$565.00K
Free cash flow
$230.00K
Fetching…
Sources
Revenue
$43.22M
Net income
$8.57M
Diluted EPS
0.19
Operating cash flow
$21.10M
Free cash flow
$20.82M
Fetching…
Sources
Is it cheap or expensive?
Fair value $39.81 vs current price $17.14
Wall Street consensus is the average analyst price target: $22.62 (-43.2% lower than our fair-value estimate).
Our most-likely fair value is $39.81 a share — about 132.3% above today's price of $17.14, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $43.5M - more cash than debt. Interest coverage 1.8x.
Net debt
$-43.54M
Interest coverage
1.80x
Mitek Systems, Inc.'s profit covers its interest bill about 1.8 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
MITK
BASELINE
Mitek Systems, Inc.
Total debt $56.17M Interest coverage 1.80x This is the baseline the peer rows are being compared against.
Total debt $12.42M Interest coverage 25.23x +1,299% vs MITK Carries about 14.0x more debt cushion than MITK.
Total debt $961.65M Interest coverage 1.11x -39% vs MITK Carries about 1.6x less debt cushion than MITK.
Total debt $31.36M Interest coverage -12.48x -100% vs MITK This peer has almost no interest-payment cushion compared with MITK.
Total debt $53.00M Interest coverage 38.25x +2,022% vs MITK Carries about 21.2x more debt cushion than MITK.
What you should know
The case for and against MITK
3 Rewards
0 Risks
Rewards
-
Revenue grew 10.1% last year.
-
Returns 9.2% on equity, ahead of 40% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
36.47x
Forward P/E
14.38x
P/B
3.09x
P/S
3.91x
EV/EBITDA
14.73x
PEG ratio
1.38x
Profitability
How much profit each dollar creates
Gross margin
83.6%
Operating margin
21.4%
Net margin
11.4%
ROE
9.2%
ROA
5.5%
Health
Liquidity and balance-sheet strength
Debt / equity
0.22x
Current ratio
2.74x
Quick ratio
2.63x
Total debt
$56.17M
Total cash
$99.71M
Growth
How the business has been compounding
Revenue TTM
$197.90M
Revenue 5Y CAGR
53.4%
EPS TTM
0.47
EPS 5Y CAGR
39.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$53.69M
Free CF TTM
$54.19M
FCF margin
27.4%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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