We recently compiled a list of 10 oversold tech stocks to buy right now. In this article, we’ll take a look at how Mitek Systems, Inc. (NASDAQ:MITK) stands compared to other oversold tech stocks.
In an interview with CNBC on September 30, Dave Sekera, chief market strategist at Morningstar, shared insights on the current state of the technology sector and broader market. The technology sector as a whole is “perfectly priced,” Sekera said, trading at a 6% premium to fair value.
But Sekera believes some tech stocks are trading too much at a 20% or more premium to fair value, even though sales are weak. Sekera advises companies trading at a premium to fair value to remove profits from consideration. Sekera’s team is also concerned that the market is overestimating the long-term growth potential of some companies due to artificial intelligence (AI), but some of these companies are currently He doesn’t think we’ll see enough benefits from AI to justify a valuation of . Mr. Sekera recommends 4-star rated stocks that are trading at a discount to fair value, and suggests swapping overvalued or overextended AI stocks for these companies. There is. Sekera also discussed the broader market, noting that growth stocks have outperformed value stocks for some time. But he believes it’s time to focus on small-cap and mid-cap value stocks, and believes these types of value stocks are ripe for rotation.
Sekera notes that the overall U.S. market is currently trading at a 3% premium to fair value. He believes this rotation into value and small-cap stocks will be driven by expectations for slower U.S. economic growth and monetary easing by the Federal Reserve. Historically, small-cap stocks have fared well in these situations, and value stocks have been left out of the AI buying frenzy. Sekera expects value stocks to catch up and thinks now is a good time to invest in these undervalued stocks.
With the Fed’s dovish stance and the possibility of further rate cuts, tech stocks could remain a safe haven for investors. With that in mind, let’s take a look at 10 oversold tech stocks to buy right now.
our methodology
To create a list of 10 oversold tech stocks to buy right now, we use Finviz and Yahoo’s stock screener to predict a significant decline on a year-to-date basis as of October 15th. I found a stock with a P/E ratio of less than 15. We then narrowed our selection to 10 stocks according to hedge fund sentiment from a database of 912 elite hedge funds as of Q2 2024. The list is sorted in ascending order of hedge fund sentiment at the second point in time. quarter.
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Close-up view of hand holding smartphone showing mobile financial application.
Number of hedge fund investors: 11
Forecast PER as of October 15: 11.83
Year-to-date performance as of October 15: -31.06%
Mitek Systems, Inc. (NASDAQ:MITK) is a software company that specializes in providing mobile capture and identity verification solutions to a variety of industries, including financial services, healthcare, and government. The company’s products and services enable businesses to automate and streamline operations, improve the customer experience, and reduce the risk of identity theft and other forms of fraud.
Mitek Systems, Inc. (NASDAQ:MITK) has a strong presence in the financial services space, with its solutions used by many leading banks and financial institutions to verify identity, detect and prevent check fraud, and facilitate mobile banking and payments. It is used in Additionally, Mitek Systems, Inc.’s (NASDAQ:MITK) Check Fraud Defender (CFD) business has gained traction for providing a shared system to combat check fraud that works across banks, and has already of major banks use this system. .
Mitek Systems, Inc.’s (NASDAQ:MITK) deepfake protection products address rapidly growing issues in the digital world, and their strong brand reputation and customer relationships in the financial industry drive significant revenue growth for the company. is expected to promote The services division, Mitek Systems, Inc. (NASDAQ:MITK), is well-positioned to take advantage of this opportunity. Analysts have a consensus Buy rating on the stock, with a price target of $12.30, indicating a potential upside of 30.44% from the current price.
Overall, MITK ranks 10th on the list of oversold tech stocks to buy. While we recognize MITK’s potential as an investment, we believe AI stocks are more likely to deliver higher returns and do so in a shorter time frame. If you’re looking for AI stocks that are more promising than MITK but are trading at less than 5x earnings, check out our report on the cheapest AI stocks.
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Disclosure: None. This article was originally published on Insider Monkey.
