Since peaking at $22.94 in September, the SEEK Limited (ASX: SEK) share price has tumbled almost 27% lower to $16.80.
This decline leaves the job listings giant's shares trading within touching distance of their 52-week low.
Should you invest?
SEEK's shares have been on a downward trajectory ever since the release of its full year results.
Although those results were strong, its guidance for the year ahead appears to have left some investors feeling underwhelmed.
In FY 2019 the company expects annual revenue growth in the range of 16% to 20%, but EBITDA growth of just 5% to 8% and flat reported net profit after tax.
Given its premium valuation this outlook was not strong enough to keep some investors from heading to the exits.
But it is worth remembering that the subdued bottom line growth this year is largely the result of the company investing in its future growth. So it could be worth dealing with the short term pain for the potential long term gains.
I'm not alone in thinking this way. A broker note out of Morgan Stanley earlier this month reveals that it remains bullish on SEEK.
The broker has retained its overweight rating and has a $21.00 price target on the company's shares. This price target implies potential upside of over 25% for its shares over the next 12 months.
Morgan Stanley is positive on SEEK due to its belief that the company will generate strong revenue growth over the next three years thanks to strong volumes across its ANZ, Asia, and China businesses.
Overall, while 2018 may have been a disappointing year for its share price, I suspect that 2019 could be a lot better.
This could make it worth considering an investment in the company's shares next year along with fellow tech stars REA Group Limited (ASX: REA) and Altium Limited (ASX: ALU).
