We recently compiled a list of the 10 Worst Performing Fintech Stocks to Buy According to Analysts. In this article, we are going to take a look at where Alkami Technology, Inc. (NASDAQ:ALKT) stands against the other fintech stocks.
Mark Palmer, Managing Director at Benchmark, joined Yahoo Finance Live on February 15, 2025, to discuss the fintech sector. He emphasized that it is currently a “stock picker’s sector.” Palmer noted that valuations in the fintech space are not connected with the growth potential of many companies.
However, he noted that not all of the fintech companies are equally positioned for success. He believes that companies heavily tied to credit, such as neobanks and online lenders, continue to be vulnerable because of growing concerns about consumer credit tightening.
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Palmer noted that some fintech companies are well-positioned to help consumers during a difficult time. For instance, companies that serve as a substitute for traditional banking, particularly for lower-income individuals who face barriers at traditional banks. He believes this type of value-added service is sustainable and companies that offer such services could experience stock boosts.
In the fintech sector, careful stock selection could be crucial. Analysts and experts see opportunities for growth in companies that offer meaningful consumer solutions.
Methodology
To compile our list of the 10 worst-performing fintech stocks to buy according to analysts, we looked for fintech companies. We reviewed our own rankings, financial media reports, ETFs, and various online resources to compile a list of fintech stocks. Then we looked for the worst-performing stocks in the fintech sector and narrowed down our list to stocks that have fallen by at least 12% year-to-date as of February 28, 2025. Next, we focused on the top fintech stocks that analysts believe have the most potential for growth. Finally, we ranked the 10 worst-performing fintech stocks to buy based on their average price target upside potential according to analysts, as of February 28, 2025.
Additionally, we mentioned the hedge fund sentiment surrounding each stock, which was taken from Insider Monkey’s Q4 2024 database of more than 1,000 elite hedge funds.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A close up of a financial institution’s server displaying multiple banking solutions.
Alkami Technology, Inc. (NASDAQ:ALKT)
Year-to-Date Performance: -16.42%
Average Price Target Upside Potential According to Analysts: 45.91%
Number of Hedge Fund Holders: 30
Alkami Technology, Inc. (NASDAQ:ALKT) is a leading cloud-based digital banking solutions provider for financial institutions in the United States. The company offers retail and business banking, digital account opening, payment security, and data and marketing solutions for banks and credit unions. Alkami Technology, Inc. (NASDAQ:ALKT) is one of the worst-performing stocks to buy in the fintech space.
In its Q4 2021 earnings call, which it referenced in its Q4 2024 earnings call, Alkami Technology, Inc. (NASDAQ:ALKT) pointed out its long-term business goals, which included succeeding in the bank market, leveraging add-on sales to drive growth, investing in its platform, and using acquisitions to drive expansion. By the end of 2024, the company had 42 banks under contract, including 23 live on the Alkami platform and 19 in its backlog. This compares to 8 banks on the company’s platform by the end of 2021. In 2024, Alkami Technology, Inc. (NASDAQ:ALKT) also became the top digital banking provider for credit unions in terms of mobile users. In 2024, add-on sales made up 45% of new bookings, up from 24% in 2021.
In February 2025, Alkami Technology, Inc. (NASDAQ:ALKT) announced its agreement to acquire MANTL for an enterprise value of $400 million. MANTL is a premier account opening solution that allows financial institutions to onboard commercial, business and retail customers across various channels for virtually any deposit account type. This transaction is expected to complement Alkami Technology, Inc.’s (NASDAQ:ALKT) existing digital banking and data marketing solutions to create an advanced digital sales and services platform for financial institutions.
Overall, ALKT ranks 5th on our list of the worst-performing fintech stocks to buy according to analysts. While we acknowledge the potential of ALKT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ALKT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
