Mitek Systems, Inc. reports 1,179% Net Income growth in 2020 and 14.2 pp EBITDA Margin growth from 4.5% to 18.8%
11/05/2020 • About Mitek Systems, Inc. (
$MITK) • By InTwits
Mitek Systems, Inc. reported FY2020 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: FY2020 revenue growth was 19.8%, 5 year revenue CAGR was 31.9% at FY2020 ROIC 8.1%
- EBITDA Margin is quite volatile: 18.8% in FY2020, 4.5% in FY2019, -4.4% in FY2018, 11.6% in FY2017, 9.3% in FY2016
- Mitek Systems, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.1%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: $1m in FY2020, $1m in FY2019, $4m in FY2018, $0m in FY2017, $0m in FY2016
- The company has business model with low profitability: ROIC is 8.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 19.8%. Revenue growth showed acceleration in FY20Q4 - it increased 22.5% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.1 pp from 27.6% to 28.7% in FY2020.
Gross Margin increased slightly on 1.5 pp from 85.5% to 87.0% in FY2020. SG&A as a % of Revenue decreased on 6.6 pp from 55.9% to 49.3% in FY2020. During the last 5 years SG&A as a % of Revenue topped in FY2018 at 61.0% and was declining since that time.
Net Income margin increased on 8.6 pp from -0.86% to 7.7% in FY2020.
Investments (CAPEX, working capital and M&A)
Mitek Systems, Inc.'s CAPEX/Revenue was 0.79% in FY2020. CAPEX/Revenue showed almost no change from FY2017 to FY2020. It's average level of CAPEX/Revenue for the last three years was 2.9%. During the last 5 years CAPEX as a % of Revenue topped in FY2018 at 6.8% and was declining since that time.
Return on investment
The company operates at low ROIC (8.1%) and ROE (6.5%). ROIC jumped on 13.1 pp from -5.0% to 8.1% in FY2020. ROE increased on 7.2 pp from -0.71% to 6.5% in FY2020.
Leverage (Debt)
Debt level is -0.7x Net Debt / EBITDA and 0.4x Debt / EBITDA. Debt jumped while cash surged on 19.3%.
Mitek Systems, Inc. has no short term refinancing risk: cash is higher than short term debt (1,098.7%).
Valuation and dividends
The company's trades at EV/EBITDA 28.2x and P/E 70.3x.
Management team
Scipio Maximus Carnecchia "Max" is a the company's CEO. Scipio Maximus Carnecchia "Max" has spent 2 years with the company. The company's CFO is Jeffrey C Davison "Jeff". Jeffrey C Davison "Jeff" has 3 years tenure at the company.
Financial and operational results
FY ended 09/30/2020
Mitek Systems, Inc. ($MITK) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 34.7 | 45.4 | 63.6 | 84.6 | 101.3 | 19.8% |
| Gross Profit | 31.3 | 41.3 | 54.9 | 72.3 | 88.1 | 21.8% |
| SG&A | 19.5 | 25.8 | 38.8 | 47.3 | 49.9 | 5.6% |
| EBITDA | 3.2 | 5.3 | -2.8 | 3.8 | 19.0 | 397.4% |
| Net Income | 2.0 | 14.1 | -11.8 | -0.7 | 7.8 | |
Balance Sheet
|
|---|
| Cash | 9.0 | 12.3 | 9.0 | 16.7 | 20.0 | 19.3% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 1.8 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 5.3 | |
Cash flow
|
|---|
| Capex | 0.3 | 0.5 | 4.3 | 1.1 | 0.8 | -24.5% |
Ratios
|
|---|
| Revenue growth | 36.8% | 30.8% | 40.0% | 33.1% | 19.8% | |
| EBITDA growth | 28.6% | 63.8% | -153.5% | -235.9% | 397.4% | |
|
|---|
| Gross Margin | 90.2% | 91.1% | 86.3% | 85.5% | 87.0% | 1.5% |
| EBITDA Margin | 9.3% | 11.6% | -4.4% | 4.5% | 18.8% | 14.2% |
| SG&A, % of revenue | 56.2% | 56.8% | 61.0% | 55.9% | 49.3% | -6.6% |
| Net Income Margin | 5.6% | 31.0% | -18.6% | -0.9% | 7.7% | 8.6% |
| CAPEX, % of revenue | 0.7% | 1.1% | 6.8% | 1.3% | 0.8% | -0.5% |
|
|---|
| ROIC | 5.2% | 5.5% | -10.4% | -5.0% | 8.1% | 13.1% |
| ROE | 5.6% | 27.9% | -15.1% | -0.7% | 6.5% | 7.2% |
| Net Debt/EBITDA | -2.8x | -2.3x | | -4.4x | -0.7x | 3.7x |
Mitek Systems, Inc. ($MITK) key quoterly financial indicators
| mln. $ | FY20Q1 | FY20Q2 | FY20Q3 | FY20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 22 | 23 | 25 | 31 | | 24.8% | 16.1% | 16.0% | 22.5% |
| EBITDA | 3 | 3 | 3 | 10 | | - | 614.4% | - | 46.8% |
| Net Income | 1 | 1 | 1 | 5 | | - | - | - | 52.3% |
Balance Sheet
|
|---|
| Cash | 15 | 17 | 19 | 20 | | 41.7% | -9.7% | 17.7% | 19.3% |
| Short Term Debt | 1 | 1 | 2 | 2 | | - | - | - | - |
| Long Term Debt | 7 | 6 | 6 | 5 | | - | - | - | - |
Ratios
|
|---|
| Gross Margin | 86.7% | 86.3% | 86.2% | 88.3% | | 3.0% | 1.2% | 0.7% | 1.2% |
| EBITDA Margin | 13.2% | 12.9% | 13.5% | 31.6% | | 26.8% | 10.8% | 17.0% | 5.2% |
| Net Income Margin | 2.5% | 3.9% | 5.3% | 16.3% | | 20.6% | 7.5% | 5.8% | 3.2% |
Peers in Application Software
Below you can find Mitek Systems, Inc. benchmarking vs. other companies in Application Software industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | - | -0.2% | -95.9% | 34.9% | 355,942.4% |
| AudioEye, Inc. ($AEYE) | - | 175.5% | 106.6% | 90.2% | 90.2% |
| Cloudera, Inc. ($CLDR) | - | 57.2% | 42.6% | 28.9% | 65.5% |
| Integrated Ventures Inc ($INTV) | - | - | - | -8.9% | 62.7% |
| Smartsheet Inc. ($SMAR) | - | 64.3% | 66.1% | 59.7% | 52.4% |
| |
|---|
| Median (92 companies) | 12.0% | 14.8% | 15.1% | 19.4% | 14.5% |
|---|
| Mitek Systems, Inc. ($MITK) | - | 30.8% | 40.0% | 33.1% | 19.8% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Aware, Inc. ($AWRE) | 90.3% | 94.6% | 92.3% | 89.7% | 92.8% |
| Alteryx, Inc. ($AYX) | 81.3% | 83.4% | 91.0% | 90.6% | 91.1% |
| Autodesk, Inc. ($ADSK) | 85.2% | 83.2% | 85.2% | 88.9% | 90.1% |
| Smith Micro Software, Inc. ($SMSI) | 73.2% | 77.9% | 83.5% | 90.9% | 89.9% |
| Cadence Design Systems, Inc. ($CDNS) | 85.9% | 87.8% | 87.9% | 88.6% | 88.6% |
| |
|---|
| Median (89 companies) | 63.8% | 64.4% | 65.3% | 67.9% | 69.4% |
|---|
| Mitek Systems, Inc. ($MITK) | 90.2% | 91.1% | 86.3% | 85.5% | 87.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -1,837.2% | -1,118.0% | -40,379.4% | -23,127.1% | 52.2% |
| j2 Global, Inc. ($JCOM) | 41.7% | 36.5% | 35.7% | 38.6% | 40.5% |
| Intelligent Systems Corporation ($INS) | -5.4% | -12.8% | 33.6% | 43.6% | 40.4% |
| Adobe Inc. ($ADBE) | 31.2% | 34.2% | 35.3% | 35.8% | 39.7% |
| SS&C Technologies Holdings, Inc. ($SSNC) | 34.9% | 37.9% | 27.7% | 38.2% | 38.3% |
| |
|---|
| Median (89 companies) | -5.3% | -4.2% | -3.3% | 2.7% | 6.8% |
|---|
| Mitek Systems, Inc. ($MITK) | 9.3% | 11.6% | -4.4% | 4.5% | 18.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| MicroStrategy Incorporated ($MSTR) | 0.5% | 0.8% | 1.4% | 2.1% | 234.8% |
| Integrated Ventures Inc ($INTV) | - | - | 199.9% | 15.2% | 27.2% |
| Intelligent Systems Corporation ($INS) | 3.8% | 9.7% | 4.3% | 4.9% | 19.2% |
| LivePerson, Inc. ($LPSN) | 5.5% | 7.9% | 8.8% | 16.3% | 11.4% |
| PROS Holdings, Inc. ($PRO) | 4.7% | 0.8% | 0.7% | 2.1% | 11.3% |
| |
|---|
| Median (87 companies) | 3.0% | 2.3% | 2.4% | 3.0% | 2.6% |
|---|
| Mitek Systems, Inc. ($MITK) | 0.7% | 1.1% | 6.8% | 1.3% | 0.8% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -210.9% | -256.8% | -416.3% | -247.2% | 137.3% |
| Manhattan Associates, Inc. ($MANH) | 99.3% | 102.5% | 80.9% | 71.7% | 53.4% |
| Citrix Systems, Inc. ($CTXS) | 16.1% | 16.7% | 25.2% | 29.8% | 33.5% |
| Sonic Foundry, Inc. ($SOFO) | -18.1% | -50.6% | -786.4% | - | 31.3% |
| Paycom Software, Inc. ($PAYC) | 75.4% | 51.1% | 47.5% | 47.5% | 28.7% |
| |
|---|
| Median (92 companies) | -9.8% | -11.8% | -10.0% | -4.2% | -2.2% |
|---|
| Mitek Systems, Inc. ($MITK) | 5.2% | 5.5% | -10.4% | -5.0% | 8.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Dropbox, Inc. ($DBX) | - | -3.8x | - | 2.4x | 1,341.0x |
| Avaya Holdings Corp. ($AVYA) | - | - | 7.4x | - | 77.9x |
| Alteryx, Inc. ($AYX) | - | - | 2.5x | 6.1x | 32.2x |
| Five9, Inc. ($FIVN) | -6.7x | -8.6x | 7.3x | 5.3x | 17.6x |
| Synchronoss Technologies, Inc. ($SNCR) | - | - | - | - | 11.6x |
| |
|---|
| Median (53 companies) | -0.9x | -0.8x | -0.7x | 0.4x | 0.3x |
|---|
| Mitek Systems, Inc. ($MITK) | -2.8x | -2.3x | - | -4.4x | -0.7x |
