The 3 best biometric stocks for a future dependent on digital identifiers

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Biometric technology has become an essential part of security in our daily lives and is likely to develop further as technology improves. From fingerprint readers and facial recognition to body scanners and more, it has become firmly established in the lives of the modern consumer. Therefore, biometric stocks have the potential to provide healthy returns over the next several years.

A recent study published by Global Industry Analysts Inc. highlighted how the global biometrics market is expected to reach the $ 44.1 billion mark by 2026. The United States and China will dominate the market and are expected to generate $ 5.7 billion and $ 7.3 billion, respectively. According to the report, the novel coronavirus pandemic has forced many companies to rethink aspects of their business – and biometric solutions have played a significant role in these changes.

In addition, the return to normal will take a considerable time. A transition to something similar to the way it used to be will require a trickle-down approach, and biometrics will alleviate a lot of pain points involving identity verification and other aspects.

With that said, let’s take a look at three small-cap biometric stocks that could cause a stir in the years to come.

  • International Bio-key (NASDAQ:BKYI)
  • Intelligence (NASDAQ:IDN)
  • Aware (NASDAQ:AWRE)

Biometric stocks to buy: International Bio-key (BKYI)

the biokey (bkyi) logo on a web page under a magnifying glass

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Based in New Jersey, Bio-key International is pure micro-cap game in the biometrics industry. It develops a range of fingerprint scanners and identification and identity management software. The pandemic has proven to be a major catalyst for the company, with impressive year-over-year revenue growth in the second quarter of 223%.

As it is still in the development phase, the BKYI stock offers many advantages.

The business has a lot to do right now, aside from the tailwinds of the massive work-from-home trend that Covid-19 has provided. These catalysts include $ 75 million in commercial and government contracts in Africa and its acquisition of PistolStar to expand its operations. From a fundamentals perspective, the company’s revenue growth has been staggering, with triple-digit growth in each of the past four quarters.

Additionally, as the company shifts to a SaaS model, its margins are expected to improve significantly in the long run. Despite its risks, BKYI stock has the potential to perform over the long term.

Intelligence (IDN)

A tablet displaying the word "Verification"

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Intellicheck is one of the leading providers of identity authentication solutions and arguably the most successful pure game in biometrics. The company experienced a business turnaround that turned out to be a huge success. Additionally, it has a strong divide in the industry including its robust technology, high pricing power, and recurring sales. Therefore, IDN stock has an incredible growth avenue ahead of it, making it an attractive long-term bet.

The fundamentals have been impressive, to say the least. Revenue growth has averaged an astounding 22% over the past five years. In addition, its revenue growth this year is over 37% year-on-year. The company’s transition to an Identity-as-a-Service business model has proven to be exceptional for its margins and revenue growth.

With high demand among retailers and financial institutions for its services, it is likely to continue to take it out of the park.

Biometric stocks to buy: Aware (AWRE)

Aware logo (AWRE) displayed on a web browser and magnified with a magnifying glass

Source: Pavel Kapysh / Shutterstock.com

Aware is one of the world’s leading providers of biometrics software and services. Although he generates most of his income from the government sector, he has started to experience incredible success in the field of commercial biometrics. It provides a full suite of identity verification and management platforms for physical and digital front-end security. Therefore, AWRE action is a fascinating biometric game with a lot of upside potential.

The company’s massive government activities include clients such as the US Department of Justice, Department of Defense, and Homeland Security. Additionally, international government clients include UK Metropolitan Police, Kingdom of Saudi Arabia, to name a few. He recently announced a partnership with Iris identification systems for local agencies to use the Federal Bureau of Investigation’s state-of-the-art Iris service.

Plus, the company has killed him financially lately. The growth of its turnover is over 34%. Therefore, Aware has a lot going on right now and has an exciting future ahead of it.

As of the publication date, Muslim Farooque does not have (directly or indirectly) any position on any of the titles mentioned in this article. The opinions expressed in this article are those of the author, subject to the InvestorPlace.com publishing guidelines.

Muslim Farooque is a passionate investor and an optimist at heart. A long-time player and passionate about technology, he has a particular affinity for analyzing technology stocks. Muslim holds a Bachelor of Science in Applied Accounting from Oxford Brookes University.


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