In conventional or online stock trading, going after cheap stocks alone is not always the ideal strategy. The stock must have opportunities and potential for growth. Only then would your trading be profitable.
Here is a tech stock that has a decent growth pattern but is selling cheap. While some investors consider tech stocks with lower P/E ratios as having low potential for price growth, the principle applies for such mature and well known stocks such as Intel or IBM. But there are lesser-known tech stocks that are worth a serious look, since the aforementioned principle regarding famous stocks doesn’t quite apply to them.
Online Chat Platform with Growing Monthly Active Users
MeetMe ($MEET) is one of these stocks. This is a social networking platform that helps users find new people for chatting. The concept has great potential, and to realize this potential at a greater level $MEET acquired a similar platform, Skout, for cash worth $28.5 million plus 5.37 million common MeetMe shares. This acquisition has given the group more than 8.5 million MAUs (monthly active users). The platforms particularly have a significant presence among the millennial generation. Of course the number of users pales in comparison to the around 50 million MAUs Tinder (Match Group) has.
However MeetMe is growing fast, and in just the last quarter its mobile MAUs rose 32% annually. That has resulted in a significant 39% surge in mobile revenues, touching $16 million. Its total revenues have also risen 20% annually to touch $17.2 million. The primary source of this revenue has been in-app ads. Its non-GAAP earnings reached $6.2 million, a 30% rise, while GAAP earnings reached $4.4 million.
Earnings and Revenue Expected to Rise Next Year
Analysts are expecting the online chat platform’s earnings and revenue to rise 17% and 38% respectively next year. That’s a significant growth. In spite of that, $MEET trades at just 10 times forward earnings and 7 times trailing earnings, when compared to the Internet information providers’ industry average P/E of 50.
Such insight is essential to make the right decisions in trading. You need to look beneath the surface to identify the nature and future potential of the stock before you decide to buy it. With online stock trading, you need the right software to help you understand and study the market in-depth. TradeZero provides you with the right stock trading software that is available in advanced but user-friendly platforms. Give us a call at +1 954-944-3885, or email us at support@tradezero.co.
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