Mitek Systems, Inc. reports 783% CAPEX growth in 2018 and 40.0% Revenue growth
11/01/2018 • About Mitek Systems, Inc. (
$MITK) • By InTwits
Mitek Systems, Inc. reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Mitek Systems, Inc. is a fast growth stock: FY2018 revenue growth was 40.0%, 5 year revenue CAGR was 33.8% at FY2018 ROIC -10.4%
- The company operates at negative EBITDA Margin: -4.4%
- EBITDA Margin is quite volatile: -4.4% in FY2018, 11.6% in FY2017, 9.3% in FY2016, 9.8% in FY2015, -25.8% in FY2014
- Mitek Systems, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: $4m in FY2018, $0m in FY2017, $0m in FY2016, $0m in FY2015, $0m in FY2014
- The company has unprofitable business model: ROIC is -10.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Mitek Systems, Inc.'s Revenue jumped on 40.0%. Revenue growth showed acceleration in FY18Q4 - it increased 63.0% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 52.3 pp from -95.7% to -148% in 2018.
Gross Margin decreased on 4.8 pp from 91.1% to 86.3% in FY2018. SG&A as a % of Revenue increased on 4.2 pp from 56.8% to 61.0% in FY2018. During FY2014-FY2018 SG&A as a % of Revenue bottomed in FY2015 at 55.4% and was growing since that time.
Net Income margin dropped on 49.6 pp from 31.0% to -18.6% in FY2018.
Investments (CAPEX, working capital and M&A)
Mitek Systems, Inc.'s CAPEX/Revenue was 6.8% in FY2018. The company showed CAPEX/Revenue growth of 6.5 pp from 0.29% in FY2015 to 6.8% in FY2018. For the last three years the average CAPEX/Revenue was 2.9%. During FY2014-FY2018 CAPEX as a % of Revenue bottomed in FY2015 at 0.29% and was growing since that time.
Return on investment
The company operates at negative ROIC (-10.4%) and ROE (-15.1%). ROIC dropped on 15.9 pp from 5.5% to -10.4% in FY2018. ROE dropped on 43.0 pp from 27.9% to -15.1% in FY2018.
Leverage (Debt)
The company has no debt. Cash dropped on 26.5%.
Management team
The company's CFO Jeffrey C Davison "Jeff" has spent 2 years with the company.
Financial and operational results
FY ended 09/30/2018
Mitek Systems, Inc. ($MITK) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 19.150 | 25.367 | 34.701 | 45.390 | 63.559 | 40.0% |
| Gross Profit | 17.002 | 22.896 | 31.306 | 41.349 | 54.873 | 32.7% |
| SG&A | 16.391 | 14.060 | 19.512 | 25.794 | 38.767 | 50.3% |
| EBITDA | -4.937 | 2.497 | 3.212 | 5.261 | -2.813 | -153.5% |
| Net Income | -5.292 | 2.526 | 1.959 | 14.092 | -11.807 | -183.8% |
Balance Sheet
|
|---|
| Cash | 7.767 | 2.753 | 9.010 | 12.289 | 9.028 | -26.5% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.135 | 0.073 | 0.250 | 0.488 | 4.307 | 782.6% |
Ratios
|
|---|
| Revenue growth | 29.4% | 32.5% | 36.8% | 30.8% | 40.0% | |
| EBITDA growth | -29.2% | -150.6% | 28.6% | 63.8% | -153.5% | |
|
|---|
| Gross Margin | 88.8% | 90.3% | 90.2% | 91.1% | 86.3% | -4.8% |
| EBITDA Margin | -25.8% | 9.8% | 9.3% | 11.6% | -4.4% | -16.0% |
| SG&A, % of revenue | 85.6% | 55.4% | 56.2% | 56.8% | 61.0% | 4.2% |
| Net Income Margin | -27.6% | 10.0% | 5.6% | 31.0% | -18.6% | -49.6% |
| CAPEX, % of revenue | 0.7% | 0.3% | 0.7% | 1.1% | 6.8% | 5.7% |
|
|---|
| ROIC | -21.8% | 7.0% | 5.2% | 5.5% | -10.4% | -15.9% |
| ROE | -21.3% | 9.3% | 5.6% | 27.9% | -15.1% | -43.0% |
| Net Debt/EBITDA | | -1.1x | -2.8x | -2.3x | |
Mitek Systems, Inc. ($MITK) key quoterly financial indicators
| mln. $ | FY18Q1 | FY18Q2 | FY18Q3 | FY18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 12 | 14 | 16 | 21 | | 30.9% | 25.0% | 36.5% | 63.0% |
| EBITDA | -2 | -1 | -1 | 1 | | | -124.1% | -211.5% | -67.7% |
| Net Income | -6 | -1 | -3 | -2 | | | -195.3% | -551.9% | -116.5% |
Balance Sheet
|
|---|
| Cash | 6 | 25 | 9 | 9 | | 2.0% | 94.8% | -7.2% | -26.5% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 86.7% | 88.0% | 83.4% | 87.3% | | -3.7% | -4.8% | -6.6% | -3.9% |
| EBITDA Margin | -14.3% | -3.6% | -8.0% | 3.5% | | -10.5% | -22.6% | -17.9% | -14.2% |
| Net Income Margin | -47.3% | -8.1% | -17.3% | -10.1% | | -40.7% | -18.8% | -22.5% | -109.8% |
Peers in Application Software
Below we provide Mitek Systems, Inc. benchmarking against other companies in Application Software industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| nFusz Inc ($FUSZ) | | | | | 433.3% |
| CloudCommerce Inc ($CLWD) | | -38.1% | 247.6% | 40.9% | 301.1% |
| Seven Stars Cloud Group, Inc. ($SSC) | | 134.7% | 663.8% | 310.3% | 161.7% |
| Aurora Mobile Limited ($JG) | | | | 304.9% | 150.8% |
| Intelligent Systems Corporation ($INS) | | 14.2% | 71.0% | 12.2% | 119.0% |
| |
|---|
| Median (150 companies) | 27.9% | 13.5% | 13.6% | 14.8% | 15.2% |
|---|
| Mitek Systems, Inc. ($MITK) | | 32.5% | 36.8% | 30.8% | 40.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Skkynet Cloud Systems Inc ($SKKY) | 99.7% | 97.4% | 98.0% | 97.6% | 96.5% |
| hopTo Inc ($HPTO) | 91.8% | 87.8% | 95.9% | 98.2% | 95.4% |
| Aware, Inc. ($AWRE) | 75.4% | 87.2% | 90.3% | 94.6% | 92.3% |
| Alteryx, Inc. ($AYX) | 77.5% | 80.5% | 81.3% | 83.4% | 91.0% |
| Aspen Technology, Inc. ($AZPN) | 86.5% | 88.7% | 89.7% | 90.2% | 89.9% |
| |
|---|
| Median (149 companies) | 62.8% | 61.7% | 63.8% | 64.4% | 65.3% |
|---|
| Mitek Systems, Inc. ($MITK) | 88.8% | 90.3% | 90.2% | 91.1% | 86.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Aspen Technology, Inc. ($AZPN) | 34.5% | 42.2% | 46.0% | 45.2% | 43.3% |
| ANSYS, Inc. ($ANSS) | 45.9% | 45.8% | 45.1% | 41.9% | 41.4% |
| Paycom Software, Inc. ($PAYC) | 15.1% | 19.5% | 35.1% | 34.4% | 35.9% |
| j2 Global, Inc. ($JCOM) | 41.6% | 40.6% | 41.7% | 36.5% | 35.7% |
| Adobe Inc. ($ADBE) | 17.5% | 25.9% | 31.2% | 34.2% | 35.3% |
| |
|---|
| Median (151 companies) | -10.1% | -10.7% | -5.3% | -4.2% | -3.1% |
|---|
| Mitek Systems, Inc. ($MITK) | -25.8% | 9.8% | 9.3% | 11.6% | -4.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| TimefireVR Inc ($TFVR) | 0.0% | 350.5% | 4.3% | | 1,021.9% |
| MGT Capital Investments Inc ($MGTI) | 0.0% | 36.5% | 221.4% | 129.8% | 344.5% |
| Integrated Ventures Inc ($INTV) | | | | | 199.9% |
| ShotSpotter, Inc. ($SSTI) | | 18.3% | 28.9% | 27.1% | 24.3% |
| Ellie Mae, Inc. ($ELLI) | 12.3% | 20.6% | 16.7% | 21.1% | 19.4% |
| |
|---|
| Median (152 companies) | 2.8% | 2.7% | 3.0% | 2.3% | 2.4% |
|---|
| Mitek Systems, Inc. ($MITK) | 0.7% | 0.3% | 0.7% | 1.1% | 6.8% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| InsPro Technologies Corp ($ITCC) | -558.9% | | | | 127.4% |
| Manhattan Associates, Inc. ($MANH) | 64.8% | 78.7% | 99.3% | 102.5% | 80.9% |
| Intuit Inc. ($INTU) | 34.2% | 23.7% | 52.1% | 72.6% | 66.8% |
| Aspen Technology, Inc. ($AZPN) | 133.4% | | | | 58.1% |
| Paycom Software, Inc. ($PAYC) | 16.7% | 30.5% | 75.4% | 51.1% | 47.5% |
| |
|---|
| Median (178 companies) | -14.2% | -13.1% | -9.8% | -11.8% | -9.1% |
|---|
| Mitek Systems, Inc. ($MITK) | -21.8% | 7.0% | 5.2% | 5.5% | -10.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Upland Software, Inc. ($UPLD) | | | 16.4x | 115.6x | 16.7x |
| Nuance Communications, Inc. ($NUAN) | 7.9x | 5.7x | 5.3x | 7.1x | 15.2x |
| Asure Software Inc ($ASUR) | 3.4x | 4.5x | 3.6x | 9.5x | 14.5x |
| SS&C Technologies Holdings, Inc. ($SSNC) | 1.7x | 7.3x | 4.6x | 3.1x | 8.5x |
| Avaya Holdings Corp. ($AVYA) | | | | | 7.4x |
| |
|---|
| Median (70 companies) | -1.4x | -0.9x | -0.9x | -0.8x | -0.7x |
|---|
