Value
9.6/10data confidence 83%| Component | Sub-score |
|---|---|
| P/S | 10.0 |
| EV/EBITDA | 8.8 |
| Fwd P/E | 10.0 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 3.0x
- ▸PEG: 0.03
- ▸Attractively valued
ALIT · Why this verdict
Why Alight (ALIT) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.1/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Alight is a statistically cheap, dividend-paying stock priced well below its analyst target, but a quality score below the engine's investable floor, a death-cross technical block, and a 3-of-4 earnings miss streak keep the position sized at zero conviction despite the wide valuation gap.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Alight trades at a deeply discounted valuation, a 3.3x forward P/E and a PEG ratio of 0.03, which the engine flags as attractively valued even as quality concerns weigh on the stock. Valuation breakdown | Forward P/E should re-rate higher, moving toward high single digits, if the market recognizes the current discount as excessive over the next 12 months. | →Stable |
| CounterA persistently low multiple can be a value trap if declining revenue and weak quality scores continue, rather than a mispricing that will correct. | ||
The quality score of 2.6 sits below the engine's 4.0 minimum floor, and the bear case flags exiting the position on quality grounds alone. Bear case | The quality score would need to rise from 2.6 to above the 4.0 floor for the position to clear the engine's minimum quality bar within 12 months. | ↓Deteriorating |
| CounterQuality scores can lag an operational turnaround; if margins and returns improve, the score could cross the floor even while headline metrics stay depressed today. | ||
The stock is under a death-cross hard block, though the setup rationale notes the MACD is improving and RSI sits at an overbought 83, suggesting the technical picture is shifting. Engine gate (failed) | The stock should clear the 200-day moving average and exit death-cross status as the recovery setup plays out over the next 12 months. | →Stable |
| CounterAn RSI of 83 signals an overbought bear-market rally that could reverse sharply, reinforcing rather than clearing the death cross. | ||
The current price sits 72% below the analyst price target, and analyst sentiment shows an estimated 102% upside per the sentiment scoring, an unusually wide gap for a mid-cap software name. Estimated upside | The price-to-target gap should narrow toward 30-40% as either the price recovers or analysts trim targets over the next 12 months. | Tripped→Stable |
| CounterA wide gap to target can reflect stale or overly optimistic analyst estimates rather than genuine mispricing, especially with light coverage of only 4 analysts. | ||
The company has missed earnings in 3 of the last 4 quarters and 30-day estimates have fallen -31.8%, a deteriorating catalyst backdrop despite the cheap valuation. Earnings | The beat/miss ratio should improve to at least 2 beats out of the next 4 quarters, with estimate revisions turning positive, over the next 12 months. | →Stable |
| CounterEstimates have already been cut sharply, which can set up easier comparisons and a higher probability of beats going forward rather than continued misses. | ||
Alight trades at a deeply discounted valuation, a 3.3x forward P/E and a PEG ratio of 0.03, which the engine flags as attractively valued even as quality concerns weigh on the stock.
→StableValuation breakdown
- Expectation
- Forward P/E should re-rate higher, moving toward high single digits, if the market recognizes the current discount as excessive over the next 12 months.
CounterA persistently low multiple can be a value trap if declining revenue and weak quality scores continue, rather than a mispricing that will correct.
The quality score of 2.6 sits below the engine's 4.0 minimum floor, and the bear case flags exiting the position on quality grounds alone.
↓DeterioratingBear case
- Expectation
- The quality score would need to rise from 2.6 to above the 4.0 floor for the position to clear the engine's minimum quality bar within 12 months.
CounterQuality scores can lag an operational turnaround; if margins and returns improve, the score could cross the floor even while headline metrics stay depressed today.
The stock is under a death-cross hard block, though the setup rationale notes the MACD is improving and RSI sits at an overbought 83, suggesting the technical picture is shifting.
→StableEngine gate (failed)
- Expectation
- The stock should clear the 200-day moving average and exit death-cross status as the recovery setup plays out over the next 12 months.
CounterAn RSI of 83 signals an overbought bear-market rally that could reverse sharply, reinforcing rather than clearing the death cross.
The current price sits 72% below the analyst price target, and analyst sentiment shows an estimated 102% upside per the sentiment scoring, an unusually wide gap for a mid-cap software name.
Tripped→StableEstimated upside
- Expectation
- The price-to-target gap should narrow toward 30-40% as either the price recovers or analysts trim targets over the next 12 months.
CounterA wide gap to target can reflect stale or overly optimistic analyst estimates rather than genuine mispricing, especially with light coverage of only 4 analysts.
The company has missed earnings in 3 of the last 4 quarters and 30-day estimates have fallen -31.8%, a deteriorating catalyst backdrop despite the cheap valuation.
→StableEarnings
- Expectation
- The beat/miss ratio should improve to at least 2 beats out of the next 4 quarters, with estimate revisions turning positive, over the next 12 months.
CounterEstimates have already been cut sharply, which can set up easier comparisons and a higher probability of beats going forward rather than continued misses.
Per-dimension breakdown
Quality
2.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.5 |
| Gross margin | 3.7 |
| Op margin | 0.0 |
| Current ratio | 5.2 |
| Moat | 3.2 |
| Piotroski F | 5.6 |
- ▸No competitive moat
- ▸Quality concerns
Growth
6.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 1.9 |
| EPS growth | 10.0 |
- ▸Declining revenue: -3%
Momentum
2.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.8 |
| MACD | 2.9 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -22.4%/30d — confirmed downtrend
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.3 |
| Price target | 10.0 |
| erm sentiment | 0.0 |
- ▸Light analyst coverage (4.0) — signal dampened
- ▸Analyst upside: 141%
- ▸Estimates falling as sentiment proxy (-31.8%)
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
2.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.6 |
| quality rank | 0.0 |
| growth rank | 0.2 |
Technical
2.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.6 |
| support resistance | 4.1 |
| 52w position | 0.0 |
Risk (lower is worse)
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.2 |
| days to cover | 10.0 |
| volatility | 0.0 |
| put call | 0.7 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 4.4 |
| debt equity | 2.9 |
- ▸Elevated put/call: 1.90
- ▸High IV: 162%
- ▸Above max pain $2
Catalyst
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 1.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 2.7 |
| dividend safety | 7.7 |
- ▸Estimates down -31.8% (30d)
- ▸Earnings concerns: 1B/3M
- ▸Earnings in 12 days
- ▸Dividend aristocrat: 16.8% yield
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (5)
- ASYMMETRY:7.0>=1.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.7<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (2)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
- EARNINGS_PROXIMITY:12d<=14d (soft)
Reward-to-Risk
7.00
Upside
+105.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($0.9B) below institutional reach
SuitabilitySpeculative — Drawdown -85% (>40% off 52w high)
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 2.7<4.5 outcome against Value at 9.6 and asymmetric R:R of 7.00.
The strongest dimensions are Value at 9.6, Insider at 7.3, and Growth at 6.0; the weakest are Peer rank at 2.5, Quality at 2.6, and Momentum at 2.7. The V9 engine flagged 2 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 7.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Deep Value Multiples
Trip ifForward P/E stays below 5x for 4 consecutive quarters, showing no re-rating from the current 3.3x reading.
- P2Quality Below Investable Floor
Trip ifQuality score stays below 3.0 for 2 consecutive quarters, remaining under the 4.0 investable floor.
- P3Death Cross Hard Block Recovering
Trip ifPrice closes below the 200-day moving average for more than 60 consecutive days, confirming the death cross rather than a recovery.
- P4Analyst Target Upside GapTripped
Trip ifUpside to the analyst target compresses below 20%, down from the current 72%, without the stock price rising.
- P5Earnings Miss Streak Falling Estimates
Trip ifEarnings misses reach at least 5 of the next 6 quarters, worsening the current 3-of-4 miss rate.