Is Cheap Tech Stock Yext a Strong Buy for the Digital Economy?

 | Jun 25, 2020 06:00AM ET

Yext (NYSE:YEXT) YEXT aims to help firms ensure their digital footprint provides consumers with the correct factual information about their business. The company’s revenue has climbed in recent years and Yext shares have surged 90% since early April to easily outpace its industry’s 26% jump. And some investors might find it even more attractive since Yext trades at under $20 a share.

Why Yext?

Yext went public in 2017 and its pitch to clients and investors is straightforward. The firm aims to help businesses provide “dynamic answers and clear calls-to-action wherever they search,” while also “reducing data discrepancies, manual work, and support costs across your teams and internal systems.”

The ability to consistently provide the most up-to-date and accurate information about a business for questions as simple as where’s the nearest location and far beyond, is increasingly important in an age that’s overrun with information. On top of that, consumers crave accurate information across various search engines and from their virtual assistants such as Amazon’s AAPL Siri.

Yext and its “Search Experience Cloud” have amassed some big-name clients such as Marriott YUM , and more. The company’s fiscal 2020 revenue climbed 31% to reach $300 million, which came on top of FY19’s 34% expansion. And Yext’s Q1 fiscal 2021 sales jumped 24%, with its customer count up 36% to roughly 2,100 for the period ended on April 30.

Investors might also be pleased to know that Yext announced a partnership with Adobe ADBE at the end of May. “Now, every Adobe rep in the world can refer Yext Answers to their customers, and Yext can show customers how Answers will deliver lower support costs, higher revenue conversion, and deep customer insights on their websites,” CEO Howard Lerman said in prepared Q1 remarks on June 4.