Mitek Systems, Inc. MITK 2.18% shares are tumbling 10 percent on Thursday morning after TheStreetSweeper released a report describing seven reasons why Mitek’s stock is on the verge of a nosedive.
Here’s a rundown of the full list:
- 1. Since November, Mitek shares are up roughly 170 percent. In that time, company insiders have sold about $9 million in stock.
- 2. Mitek’s decision to drop its patent infringement case against Top Image Systems Ltd. TISA 0.01% is an indication of how little value Mitek places on its intellectual property.
- 3. The competition has passed Mitek by. In January, USAA became the first major U.S. financial institution to introduce full-scale facial and voice recognition features on its mobile app.
- 4. USAA worked with Doan to develop its product, and other large banks are now working with Doan as well.
- 5. Mitek’s massive run-up in valuation from $90 million to $292 million was triggered by its acquisition of ID checker, only a $10 million company.
- 6. At its current share price, Mitek’s price/sales ratio and trailing P/E ratios are both more than triple those of the overall industry.
- 7. Finally, while Mitek turned a modest $582,000 in profit for the first time in 2015, the company has accumulated…
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