Audioeye Shares Rise 212% YTD: Should Investors Buy the Stock?

Core Viewpoint - Audioeye (AEYE) has demonstrated exceptional stock performance, significantly outperforming both the Zacks Computer & Technology sector and the Zacks Internet-Software industry year to date, driven by innovative solutions and strategic partnerships [1][2]. Group 1: Performance Metrics - AEYE shares have surged 212.1% year to date, compared to the Zacks Computer & Technology sector's 33.8% and the Zacks Internet-Software industry's 43% [1]. - The company has outperformed peers such as Fortinet (67.3%), Synchronoss Technologies (65.5%), and Aspen Technology (13%) during the same period [1]. Group 2: Product and Partnership Strength - AEYE's innovative product portfolio, including the Accessibility Protection Status and Accessibility Testing Software Kit, enhances customer risk assessment and facilitates early issue resolution in software development [3]. - The partnership with Finalsite expands AEYE's presence in the K-12 education sector, while the collaboration with CivicPlus allows access to over 10,000 government clients, enhancing local government market penetration [4]. Group 3: Acquisitions and Compliance - The acquisition of ADA Site Compliance strengthens AEYE's customer base and recurring revenue streams, enhancing its digital accessibility solutions [5]. - Achieving HIPAA compliance and SOC 2 Type 2 certification boosts AEYE's credibility, positioning it to meet the demands of healthcare and regulated sectors [5]. Group 4: Financial Outlook - For Q4 2024, AEYE anticipates revenues of $9.7-$9.8 million, reflecting a 24% year-over-year growth, with adjusted EBITDA expected to be $2.2-$2.3 million, indicating a 23% margin [6]. - The full-year 2024 revenue forecast is between $35.2 million and $35.3 million, with adjusted EBITDA projected at $6.62 - $6.72 million and adjusted earnings of 54 to 55 cents per share [6]. Group 5: Consensus Estimates - The Zacks Consensus Estimate for Q4 revenues is $9.73 million, indicating a year-over-year growth of 23.67%, with earnings pegged at 18 cents per share, reflecting a 63.64% increase [7]. - For full-year 2024, the consensus revenue estimate is $35.21 million, showing a 12.44% year-over-year growth, with earnings expected at 52 cents per share [8]. Group 6: Investment Potential - AEYE's strong product portfolio, growing partnerships, and strategic acquisitions position it for sustained growth in the digital accessibility market [10]. - The company holds a Zacks Rank 2 (Buy) and a Growth Score of A, indicating a favorable investment opportunity [11].