The best time to buy a stock is when it goes out of fashion among investors. And that’s definitely the case Experiment (LSE:EXPN) right now.

However, analysts expect a forceful rebound. So, with an average price target of 54% above the stock’s current level, is this a occasional buy opportunity?

FTSE 100 heavyweight

Experian is one of the most impressive companies listed on the FTSE 100. It has a forceful competitive advantage that does not require huge capital investments to maintain.

The company’s advantage comes from the data it uses to create reports. This information comes from many sources and contains a lot of information that is not publicly available.

Moreover, Experian’s credit scores were a key asset for U.S. lenders looking to resell their mortgage loans. Although this situation has changed recently, it is still largely the case.

That’s why the company’s shares have always traded at above-average multiples. However, the stock exchange currently believes that the company may become a victim of artificial intelligence (AI).

The threat of artificial intelligence disruption

Artificial intelligence will not be able to match Experian’s product – there is no data. The problem, however, is that it may be able to offer a close enough alternative at a fraction of the price.

The FTSE 100 company has an extremely forceful position in the mortgage market, but that is only one part of the business. The rest are things like payday loans and credit cards.

In such cases, lenders may find that an AI-based background check, which uses less data, is good enough at a much lower price. And this is the real threat that Experian must deal with.

That’s why stocks are falling. However, the question for investors is whether this justifies the 34% decline from highs or whether investors are overreacting to a recent and unusual threat.

How resilient is the company?

For now, there are no signs of disruption to Experian’s results. The latest update showed 8% organic revenue growth, and this growth is expected to continue over the next few months.

However, investors need to think carefully about this. Given the threat a company faces, the situation can change suddenly and without warning.

This means that the insights investors can gain from past performance are very constrained. This is always true to some extent, but it’s especially true with Experian these days.

If AI competition starts making progress in key markets, things could change very quickly. Therefore, investors need to look beyond the numbers to assess a company’s resilience.

Time to buy?

At its peak, a £10,000 investment in Experian bought 244 shares. Since the company’s stock is currently trading well below this level, investors can purchase 373 shares for the same amount of cash.

Analyst price targets suggest a forceful rebound is expected in the near future. However, I think investors should exercise some caution in this case.

While the company’s core mortgage business is very well protected, I see some huge potential threats elsewhere. And these should be taken seriously.

I think that the development of artificial intelligence creates extremely good investment opportunities. But Experian is not a stock I want to buy right now to take advantage.