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APPN

Appian NasdaqGM:APPN Stock Report

Last Price

US$44.29

Market Cap

US$3.2b

7D

3.1%

1Y

-50.6%

Updated

05 Oct, 2022

Data

Company Financials +
APPN fundamental analysis
Snowflake Score
Valuation0/6
Future Growth1/6
Past Performance0/6
Financial Health5/6
Dividends0/6

APPN Stock Overview

Appian Corporation provides low-code automation platform in the United States and internationally.

Appian Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Appian
Historical stock prices
Current Share PriceUS$44.29
52 Week HighUS$104.45
52 Week LowUS$38.78
Beta1.6
1 Month Change2.62%
3 Month Change-17.46%
1 Year Change-50.55%
3 Year Change-7.61%
5 Year Change90.25%
Change since IPO195.07%

Recent News & Updates

Aug 18

Appian: Under-Recognized Potential

Shares of Appian have dropped 20% this year to a very buyable valuation. Appian's fundamentals have held up well amid a tightening macro environment. Appian has preserved 30%+ growth rates. Though profits have dropped slightly, Appian's new larger subscription revenue mix and higher gross margins should help the business to scale. An impending $2 billion windfall from Appian's court victory against Pegasystems is hardly factored into the stock price. This year's market chaos has called what I would call "dislocation" in the growth stock segment. Investors have sold off high-valued growth stocks, especially in the tech sector, in an almost indiscriminate fashion. Fear bred selling momentum, and just like in the tech run-up of the pandemic when fundamentals were ignored in sharp rallies, fundamentals were also ignored on the way down. It's a good time, in my view, to buy into shares of high-quality tech stocks on these pullbacks, and Appian (APPN) is a great candidate here. This business process management (BPM) software company is capitalizing on a post-pandemic surge in demand for business transformation and automation. But in spite of continued strong results, the stock has followed the rest of the market in a downtrend this year, and has shed 20% of its value to date. APPN data by YCharts Though I haven't always been bullish on Appian, I remain a solid buy here. The company's management has an interesting stance on the state of the macroeconomy - while Appian is officially "bearish" and has seen some signs of deal cycles elongating, it's so far citing no impact from macro conditions on its results. More on this regard from CEO Matt Calkins' prepared remarks on the Q2 earnings call: Appian is officially bearish on the economy. I'm bearish. I think inflation will persist and economy-wide demand will slow, and the U.S. will probably end up accommodating an unhealthy level of inflation while suffering the penalties of reduced growth as well, essentially the opposite of the soft landing theory. I say this upfront because I want to be clear that while my forecast informs Appian's plans, it stands apart from Appian's experience. Appian is not seeing any evidence of a downturn. None of the symptoms I just described are visible from the perspective of our business. We saw some deals slip out of the second quarter, which could be taken as a sign that deal cycles are lengthening but we always see a few deals slip, and Q2 wasn't unusual." Looking ahead to the longer term, as a reminder for investors who are newer to this name, here are what I view to be the key bullish drivers for Appian: Broad use cases and deeply greenfield market. Appian estimates its TAM at roughly $37 billion, indicating that its present ~$500 million annual revenue run rate is only a fraction penetrated into the BPM space (business process management). Automation is a benefit to any industry, any department, and any workflow - and with the dearth and expense of technical workers to go solve these problems, businesses are finding it faster and easier to have line-of-business users automate their own processes instead, as long as limited technical knowledge is needed. $2 billion court decision against Pegasystems in Appian's favor. The quick background here: Pegasystems (PEGA), one of Appian's key rivals in BPM, was found guilty of hiring a worker as a government contractor to remit back Appian's internal software secrets back to Pegasystems. Needless to say, a $2 billion windfall would be quite substantial for a company like Appian that generates shy of $500 million in revenue and whose market cap is less than $4 billion. Stellar growth is now coming from subscriptions. Appian continues to generate >30% y/y subscription revenue growth, and its mix of low-margin professional services revenue continues to shrink, which has pushed up Appian's gross margins to be closer in line with software peers. High levels of government authorization. As software investors are aware, selling software into the U.S. federal government requires hard-earned approvals, but can command some of the highest contract values in the industry. Appian Government Cloud received provisional authorization at "Impact Level 5", which broadens its scope with the Department of Defense. According to Appian, it is one of the first companies ever to receive this level of authorization. Checking in on valuation: at current share prices near $52, Appian trades at a market cap of $3.79 billion. After we net off the $138.0 million of cash on Appian's most recent balance sheet, the company's resulting enterprise value is $3.66 billion. For the current fiscal year, Appian has guided to $466-$470 million in revenue, representing 26-27% y/y growth. This is an increase from the company's prior outlook of 23-24% y/y growth - a refreshing instance of a tech companies boosting its forecast when guidance cuts are more the norm during the Q2 earnings cycle. Appian outlook (Appian Q2 earnings deck) Against this revenue outlook, Appian trades at 7.8x EV/FY22 revenue. If we look ahead to FY23, where Wall Street consensus is calling for Appian to grow revenue 16% y/y to $542.9 million (data from Yahoo Finance), Appian's revenue multiple goes to 6.7x EV/FY23 revenue. Note that it seems the market is heavily discounting the $2.036 billion in damages awarded to Appian in the Pegasystems case. Now, here's the fine print on the press release announcing the court victory: The jury's verdict and the court's entry of judgment is subject to appeal by Pegasystems. Pegasystems is not required to pay Appian the amount awarded by the jury until all appeals are exhausted and the judgment is final. Appian cannot predict the outcome of any appeals or the time it will take to resolve them. While it's certainly possible that the outcome will be appealed and the total damages reduced, this victory represents a giant windfall for Appian. Even if, say, ~$1 billion or half of the damages were ultimately awarded, Appian's enterprise value would fall to $2.66 billion and trade at a ~4.9x multiple of FY23 revenue. The bottom line here: there's a lot to like about Appian in the current market. It has successfully pulled off a beat-and-raise quarter in Q2 at a time that many companies are voicing slowdown concerns. Its high mix of high-margin subscription revenue will eventually tip the company into profitability, and it is supported by secular tailwinds toward software-driven business transformation. Stay long here and wait on a full rebound. Q2 download Let's now cover Appian's latest Q2 results in greater detail. The Q2 earnings summary is shown below: Appian Q2 results (Appian Q2 earnings deck)

Shareholder Returns

APPNUS SoftwareUS Market
7D3.1%5.6%4.4%
1Y-50.6%-28.0%-18.2%

Return vs Industry: APPN underperformed the US Software industry which returned -28% over the past year.

Return vs Market: APPN underperformed the US Market which returned -18.2% over the past year.

Price Volatility

Is APPN's price volatile compared to industry and market?
APPN volatility
APPN Average Weekly Movement8.7%
Software Industry Average Movement8.7%
Market Average Movement6.9%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.8%

Stable Share Price: APPN is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: APPN's weekly volatility (9%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19991,798Matt Calkinshttps://www.appian.com

Appian Corporation provides low-code automation platform in the United States and internationally. The company’s platform automates the creation of forms, workflows, data structures, reports, user interfaces, and other software elements that are needed to be manually coded. The company also offers professional and customer support services.

Appian Fundamentals Summary

How do Appian's earnings and revenue compare to its market cap?
APPN fundamental statistics
Market CapUS$3.21b
Earnings (TTM)-US$123.74m
Revenue (TTM)US$421.73m

7.6x

P/S Ratio

-25.9x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
APPN income statement (TTM)
RevenueUS$421.73m
Cost of RevenueUS$119.04m
Gross ProfitUS$302.69m
Other ExpensesUS$426.43m
Earnings-US$123.74m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)-1.71
Gross Margin71.77%
Net Profit Margin-29.34%
Debt/Equity Ratio0%

How did APPN perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is APPN undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for APPN?

Other financial metrics that can be useful for relative valuation.

APPN key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue7.4x
Enterprise Value/EBITDA-28.8x
PEG Ration/a

Price to Sales Ratio vs Peers

How does APPN's PS Ratio compare to its peers?

APPN PS Ratio vs Peers
The above table shows the PS ratio for APPN vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPSEstimated GrowthMarket Cap
Peer Average6.6x
VRNS Varonis Systems
7.2x18.8%US$3.1b
RPD Rapid7
4.4x20.0%US$2.7b
TENB Tenable Holdings
6.7x18.0%US$4.1b
PING Ping Identity Holding
7.9x17.6%US$2.4b
APPN Appian
7.6x16.5%US$3.2b

Price-To-Sales vs Peers: APPN is expensive based on its Price-To-Sales Ratio (7.6x) compared to the peer average (6.6x).


Price to Earnings Ratio vs Industry

How does APPN's PE Ratio compare vs other companies in the US Software Industry?

Price-To-Sales vs Industry: APPN is expensive based on its Price-To-Sales Ratio (7.6x) compared to the US Software industry average (4.4x)


Price to Sales Ratio vs Fair Ratio

What is APPN's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

APPN PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio7.6x
Fair PS Ratio6.9x

Price-To-Sales vs Fair Ratio: APPN is expensive based on its Price-To-Sales Ratio (7.6x) compared to the estimated Fair Price-To-Sales Ratio (6.9x).


Share Price vs Fair Value

What is the Fair Price of APPN when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: APPN ($44.29) is trading above our estimate of fair value ($4.86)

Significantly Below Fair Value: APPN is trading above our estimate of fair value.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.


Discover undervalued companies

Future Growth

How is Appian forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


48.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: APPN is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: APPN is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: APPN is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: APPN's revenue (16.5% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: APPN's revenue (16.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: APPN is forecast to be unprofitable in 3 years.


Discover growth companies

Past Performance

How has Appian performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


-21.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: APPN is currently unprofitable.

Growing Profit Margin: APPN is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: APPN is unprofitable, and losses have increased over the past 5 years at a rate of 21.7% per year.

Accelerating Growth: Unable to compare APPN's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: APPN is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (14.3%).


Return on Equity

High ROE: APPN has a negative Return on Equity (-60.34%), as it is currently unprofitable.


Discover strong past performing companies

Financial Health

How is Appian's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Stable Cash Runway

  • Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: APPN's short term assets ($315.4M) exceed its short term liabilities ($212.3M).

Long Term Liabilities: APPN's short term assets ($315.4M) exceed its long term liabilities ($52.2M).


Debt to Equity History and Analysis

Debt Level: APPN is debt free.

Reducing Debt: APPN had no debt 5 years ago.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: APPN has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if APPN has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


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Dividend

What is Appian current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage

Dividend Yield vs Market

Appian Dividend Yield vs Market
How does Appian dividend yield compare to the market?
SegmentDividend Yield
Company (Appian)n/a
Market Bottom 25% (US)1.6%
Market Top 25% (US)4.5%
Industry Average (Software)1.1%
Analyst forecast in 3 Years (Appian)0%

Notable Dividend: Unable to evaluate APPN's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate APPN's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if APPN's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if APPN's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as APPN has not reported any payouts.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

6.8yrs

Average management tenure


CEO

Matt Calkins (49 yo)

23.17yrs

Tenure

US$981,848

Compensation

Mr. Matthew W. Calkins, also known as Matt, has been the Chief Executive Officer and President of Appian Corporation since August 1999. Mr. Calkins co-founded Appian Corporation in August 1999 and has been...


CEO Compensation Analysis

Matt Calkins's Compensation vs Appian Earnings
How has Matt Calkins's remuneration changed compared to Appian's earnings?
DateTotal Comp.SalaryCompany Earnings
Jun 30 2022n/an/a

-US$124m

Mar 31 2022n/an/a

-US$98m

Dec 31 2021US$982kUS$708k

-US$89m

Sep 30 2021n/an/a

-US$69m

Jun 30 2021n/an/a

-US$47m

Mar 31 2021n/an/a

-US$35m

Dec 31 2020US$809kUS$500k

-US$33m

Sep 30 2020n/an/a

-US$38m

Jun 30 2020n/an/a

-US$49m

Mar 31 2020n/an/a

-US$47m

Dec 31 2019US$10mUS$483k

-US$51m

Sep 30 2019n/an/a

-US$54m

Jun 30 2019n/an/a

-US$54m

Mar 31 2019n/an/a

-US$55m

Dec 31 2018US$530kUS$400k

-US$49m

Sep 30 2018n/an/a

-US$42m

Jun 30 2018n/an/a

-US$34m

Mar 31 2018n/an/a

-US$37m

Dec 31 2017US$611kUS$400k

-US$31m

Sep 30 2017n/an/a

-US$29m

Jun 30 2017n/an/a

-US$28m

Mar 31 2017n/an/a

-US$17m

Dec 31 2016US$9mUS$400k

-US$13m

Compensation vs Market: Matt's total compensation ($USD981.85K) is below average for companies of similar size in the US market ($USD6.80M).

Compensation vs Earnings: Matt's compensation has increased whilst the company is unprofitable.


Leadership Team

Experienced Management: APPN's management team is seasoned and experienced (6.8 years average tenure).


Board Members

Experienced Board: APPN's board of directors are seasoned and experienced ( 14 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

NasdaqGM:APPN Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
22 Jun 22BuyUS$4,596,979Abdiel Capital Advisors, LPCompany104,552US$44.77
03 Jun 22BuyUS$1,832,527Abdiel Capital Advisors, LPCompany38,351US$48.86
31 May 22BuyUS$3,886,532Abdiel Capital Advisors, LPCompany81,825US$48.47
24 May 22BuyUS$7,180,218Abdiel Capital Advisors, LPCompany163,390US$51.00
19 May 22BuyUS$14,345,483Abdiel Capital Advisors, LPCompany289,966US$52.00
10 May 22BuyUS$36,976,644Abdiel Capital Advisors, LPCompany650,000US$59.42
10 May 22BuyUS$36,976,644Abdiel Capital Advisors, LPCompany650,000US$59.42
09 May 22BuyUS$38,015,757Abdiel Capital Advisors, LPCompany843,000US$50.29
06 May 22BuyUS$20,699,131Abdiel Capital Advisors, LPCompany443,000US$50.29
04 May 22BuyUS$993,651Abdiel Capital Advisors, LPCompany16,762US$59.28
04 May 22BuyUS$7,568,834Abdiel Capital Advisors, LPCompany157,000US$51.00
08 Apr 22BuyUS$2,632,744Abdiel Capital Advisors, LPCompany47,500US$57.00
04 Apr 22SellUS$228,025Albert BiddleIndividual3,500US$65.15
18 Mar 22BuyUS$59,000Abdiel Capital Advisors, LPCompany1,000US$59.00
17 Mar 22BuyUS$7,396,817Abdiel Capital Advisors, LPCompany140,000US$59.28
14 Mar 22BuyUS$5,429,543Abdiel Capital Advisors, LPCompany105,500US$57.00
09 Mar 22BuyUS$5,954,530Abdiel Capital Advisors, LPCompany110,000US$56.26
01 Mar 22BuyUS$1,381,162Abdiel Capital Advisors, LPCompany22,875US$61.28
24 Feb 22BuyUS$6,611,695Abdiel Capital Advisors, LPCompany126,231US$56.00
01 Feb 22BuyUS$7,371,402Abdiel Capital Advisors, LPCompany126,350US$59.15
25 Jan 22BuyUS$1,918,165Abdiel Capital Advisors, LPCompany39,500US$52.52
03 Dec 21BuyUS$26,476Michael DevineIndividual400US$66.19
22 Nov 21BuyUS$30,432Michael DevineIndividual400US$76.08

Ownership Breakdown

What is the ownership structure of APPN?
Owner TypeNumber of SharesOwnership Percentage
Private Companies5,2620.007%
Hedge Funds8,328,11811.5%
General Public11,996,28716.6%
Institutions21,554,75729.8%
Individual Insiders30,565,40742.2%

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Top 25 shareholders own 78.94% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
38.51%
Matthew Calkins
27,897,930$1.2b0%no data
11.5%
Abdiel Capital Advisors, LP
8,328,118$368.9m39.91%20.53%
7.91%
Baillie Gifford & Co.
5,729,844$253.8m-2.43%0.12%
5.13%
The Vanguard Group, Inc.
3,718,471$164.7m0.09%no data
4.07%
BlackRock, Inc.
2,948,356$130.6m1.21%no data
3.28%
Robert Kramer
2,377,125$105.3m0%no data
1.42%
First Trust Advisors LP
1,028,077$45.5m-7.48%0.05%
1.13%
State Street Global Advisors, Inc.
819,791$36.3m0.88%no data
0.99%
Geode Capital Management, LLC
713,882$31.6m0.27%no data
0.74%
StackLine Partners LP
534,484$23.7m-2.21%12.99%
0.51%
Northern Trust Global Investments
368,497$16.3m-1.42%no data
0.44%
Norges Bank Investment Management
318,268$14.1m0%no data
0.42%
Bessemer Investment Management LLC
306,699$13.6m0%0.03%
0.4%
Charles Schwab Investment Management, Inc.
288,261$12.8m0.4%no data
0.36%
D. E. Shaw & Co., L.P.
259,466$11.5m12.42%0.02%
0.32%
Morgan Stanley Investment Management Inc.
233,806$10.4m-11.26%0.01%
0.24%
Silvercrest Asset Management Group LLC
171,230$7.6m-2.41%0.05%
0.23%
Advantage Alpha Capital Partners LP
169,257$7.5m37.29%1.2%
0.22%
BNY Mellon Asset Management
161,371$7.1m-3.24%no data
0.22%
Millennium Management LLC
160,697$7.1m-49.46%0.01%
0.19%
Albert Biddle
140,021$6.2m0.47%no data
0.19%
Two Sigma Investments, LP
138,846$6.1m333.8%0.02%
0.18%
Voloridge Investment Management, LLC
133,711$5.9m-49.33%0.03%
0.17%
Woodline Partners LP
123,724$5.5m0%0.08%
0.17%
Morgan Stanley, Investment Banking and Brokerage Investments
120,231$5.3m7.23%no data

Company Information

Appian Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Appian Corporation
  • Ticker: APPN
  • Exchange: NasdaqGM
  • Founded: 1999
  • Industry: Systems Software
  • Sector: Software
  • Implied Market Cap: US$3.209b
  • Shares outstanding: 72.45m
  • Website: https://www.appian.com

Number of Employees


Location

  • Appian Corporation
  • 7950 Jones Branch Drive
  • McLean
  • Virginia
  • 22102
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
APPNNasdaqGM (Nasdaq Global Market)YesClass A Common StockUSUSDMay 2017
910DB (Deutsche Boerse AG)YesClass A Common StockDEEURMay 2017
0HGMLSE (London Stock Exchange)YesClass A Common StockGBUSDMay 2017

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/10/05 00:00
End of Day Share Price2022/10/05 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.