MGIC Stock Analysis: Buy, Sell, or Hold?
MGIC - Magic Software Enterprises Ltd
$25.69
-0.39 (-1.50%)
▼
5d:
-4.75%
30d:
-2.54%
90d:
+23.45%
BUY
MODERATE Confidence
Last Updated: January 30, 2026
Earnings: Mar 10, 2026
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Interactive Price Chart (1 Month)
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Bottom Line:
💡 BUY OPPORTUNITY: MGIC shows positive signals but monitor for confirmation. Market pricing in 0.1% decline. Moderate conviction.
💡 BUY OPPORTUNITY: MGIC shows positive signals but monitor for confirmation. Market pricing in 0.1% decline. Moderate conviction.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$35.62
Based on 6.8% avg growth
INTRINSIC VALUE TODAY
$22.12
Trading above fair value
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 22.8x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: MGIC is currently trading at $25.69, which is considered oversold relative to its 30-day fair value range of $26.09 to $27.39. The stock's valuation (Forward PE: 22.8) is in line with its historical norms (22.8). Remarkably, the market is currently pricing in an annual earnings decline of 0.1% over the next few years. This pessimistic expectation contrasts with the company's recent 17.6% earnings growth, suggesting potential undervaluation if the company simply maintains stability.
Technical Outlook: Technically, MGIC is in a strong uptrend. Immediate support is located at $24.81, while resistance sits at $27.50.
Market Sentiment: The stock shows a mixed technical setup (40/100), with neutral trendline and momentum signals. However, the stock is trading significantly above the average Wall Street target of $18.00. Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Technical Outlook: Technically, MGIC is in a strong uptrend. Immediate support is located at $24.81, while resistance sits at $27.50.
Market Sentiment: The stock shows a mixed technical setup (40/100), with neutral trendline and momentum signals. However, the stock is trading significantly above the average Wall Street target of $18.00. Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Quick Decision Summary
Current Position
OVERSOLD
Fair Price Range
$26.09 -
$27.39
Company Quality Score
55/100
(HOLD)
Options IV Signal
46th percentile
(NORMAL)
Volume Confirmation
HIGH
Confidence Score
70.0%
All Signals
- BULLISH: Price oversold vs 30-day range
- NEUTRAL: Options fairly priced (IV 46th percentile)
- NEUTRAL: Mixed technical signals (40/100)
- BULLISH: High volume confirmation
- BEARISH: Trading 29.9% above Wall St target ($18.00)
Fair Price Analysis
30-Day Fair Range
$26.09 -
$27.39
Current vs Fair Value
OVERSOLD
Expected Move (7 Days)
±$2.03
(7.9%)
Support & Resistance Levels
Support Level
$24.81
Resistance Level
$27.50
Current Trend
Strong Uptrend
Fundamental Context
Forward P/E (Next Year Est.)
22.77
Wall Street Target
$18.00
(-29.9%)
Revenue Growth (YoY)
13.1%
Earnings Growth (YoY)
17.6%
Profit Margin
6.6%
Valuation Discount vs History
-0.1% cheaper
PE vs Historical
22.8 vs 22.8
FAIR
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-0.1%
(market-implied from PE analysis)
1-Year Target
$25.66
(0%)
2-Year Target
$25.64
(0%)
3-Year Target
$25.61
(0%)
3-Yr Target (if PE normalizes)
(PE: 23→23)
$25.64
(0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 22.8, Growth: 9.5%)
$33.69
(+31%)
Base:
(SPY PE: 22.3, Growth: 9.5%)
$32.99
(+28%)
Bear:
(PE: 19.0, Growth: 9.5%)
$28.04
(+9%)
📈
Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (32x PE), but valuation improves significantly next year (23x PE) as earnings recover.
Trailing PE: 32.45 | Current EPS (TTM): $0.82
Bull Case
$40.27
(+57%)
Analyst growth 37.6%, PE expands to 35.7
Base Case
$36.60
(+43%)
Market implied 37.6%, PE stable at 32.5
Bear Case
$18.09
(-30%)
Severe decline -20.0%, PE contracts to 27.6
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
💡
Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 22.8 to 22.8
Stabilization Target:
$25.72
(+0.1%)
PE Expansion Potential:
+0.1%
Last updated: February 02, 2026 8:31 AM ET
Data refreshes hourly during market hours. Next update: 9:31 AM
Data refreshes hourly during market hours. Next update: 9:31 AM
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Technical Signals Check
Is MGIC showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
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