AppFolio, Inc. (APPF) Stock: Why It’s Headed For The Top

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AppFolio, Inc. (APPF) is gaining in the market today. The stock, focused in the technology industry, is currently priced at $99.72 after a move up of 5.01% so far today. In terms of technology companies, there are several aspects that have the ability to lead to price movement in the market. News tends to be one of the biggest reasons for the movement. Here are the most recent headlines associated with APPF:

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Oct-30-19 10:57AM Internet Software Industry Growth Prospects Bullish
Oct-28-19 06:25PM AppFolio (APPF) Q3 Earnings and Revenues Surpass Estimates
04:10PM AppFolio, Inc. Announces Third Quarter 2019 Financial Results
02:30PM AppFolio, Inc. to Host Earnings Call
07:42AM AppFolio’s Earnings Preview

Nonetheless, any time investors are making a decision to invest, prospective investors should look into much more than news, especially in the ever changing technology industry. Here’s what’s happening in regard to AppFolio, Inc..

Recent Trends From APPF

Although a gain in a single session, like what we’re seeing from AppFolio, Inc. might lead to excitement in some investors, a single session move by itself shouldn’t be the reason for a decision to, or not to, buy a company’s stock. It’s generally a good idea to look into trends experienced by the stock beyond a single trading day. In the case of APPF, below are the movements that we have seen:

  • Weekly – In the last five trading sessions, APPF has produced a change in value in the amount of 14.45%.
  • Monthly – The return from AppFolio, Inc. in the last month comes to 5.35%.
  • Past Three Months – Throughout the last 3 months, the stock has produced a return on investment that comes to 0.53%
  • Past 6 Months – In the past six months, investors have seen a performance of 2.76% from the company.
  • YTD – Since the the first trading session of this year APPF has resulted in a ROI of 68.39%.
  • Full Year – Finally, throughout the past year, we’ve seen performance amounting to 66.73% out of APPF. Over this period, the stock has traded at a high of -9.25% and a low price of 94.96%.

Ratios To Watch

Looking at a few key ratios having to do with a stock can give prospective investors a view of how dangerous and/or potentially profitable a stock pick may be. Here are some of the important ratios to think about when digging into APPF.

Short Ratio – The short ratio is a tool that’s used by investors to get an understanding of the level of short interest. As the ratio goes higher, it means that more investors are expecting that the price of the stock is going to fall. Throughout the sector, strong technology stocks tend to carry a lower short ratio. On the other hand, we also see a lot of short squeezes in the industry. Nonetheless, in relation to AppFolio, Inc., the stock’s short ratio is 10.42.

Quick & Current Ratios – The quick and current ratios are ratios that are used to measure liquidity. Essentially, they measure the company’s abilities to pay for its debts when they mature based on current assets or quick assets. Because in tech, many companies are heavily reliant on the continuation of support from investors as they work to bring new technologies to market, these ratios can seem damning. However, quite a few gems in the tech space come with good quick and current ratios. In terms of APPF, the quick and current ratios work out to 1.50 and 1.50 respectively.  

Book To Share Value – The book to share value ratio compares the book value of assets owned by the company to the price of shares. when it comes to AppFolio, Inc., the book to share value ratio is 3.48.

Cash To Share Value – The cash to share value ratio compares the total cash on hand to the price of the company’s stock. In terms of APPF, the cash to share value ratio works out to 1.14.

Big Money And AppFolio, Inc.

One thing I’ve come to understand in my short time in existence has been that smart investors tend to follow the moves made by big money. In other words, investors that are trying to keep their investments relatively safe will watch moves made by institutional investors as well as insiders of the company. So, how does the big money flow when it comes to APPF? Here’s the scoop:

  • Institutions – As it stands now, institutional investors own 78.40% of APPF. Nonetheless, it’s worth noting that the ownership held by institutions has seen a move in the amount of 6.05% in the past 3 months.
  • Insiders – When it comes to insiders, insiders of the company currently own 0.40% of the company. Their ownership of the company has seen a change of -38.57% throughout the last quarter.

Analyst Opinions With Regard To AppFolio, Inc.

While it’s not a smart idea to blindly follow the thoughts of analysts, it is a good idea to use their opinions to validate your own thoughts before making investment decisions in the technology industry. Here are the recent moves that we have seen from analysts when it comes to APPF.

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Jul-30-19 Downgrade DA Davidson Neutral → Underperform
Jul-16-19 Resumed KeyBanc Capital Markets Sector Weight
Dec-06-18 Initiated DA Davidson Neutral
May-21-18 Downgrade Morgan Stanley Equal-Weight → Underweight
Dec-06-16 Resumed Credit Suisse Neutral $19

What We’ve Seen In earnings results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $0.58. In the current quarter, analysts see the company producing earnings in the amount of $0.09. Over the last 5 years, APPF has generated revenue in the amount of $48.30% with earnings coming in at 35.00%. On a quarter over quarter basis, earnings have seen movement of 209.70% and revenue has seen movement of 34.70%.

Interested In How Many Shares Are Available?

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 34.04M shares of AppFolio, Inc. outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, APPF has a float of 15.77M.

I also like to dig into the short percentage of the float. After all, if a high portion of the float available for trading is shorted, the overall feeling among traders is that the company is going to fall hard. With regard to APPF, the percentage of the float that is currently being sold short is 9.47%. Most traders believe that a high short percent of the float is anything over 40%. Through my work, I have calculated that any short percent of the float over 26% is probably going to be a risky play.

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