Appian (APPN) AI Stock Analysis

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Appian

(NASDAQ:APPN)

58Neutral

Appian's overall stock score reflects robust revenue growth and improved cash flow management, but persistent profitability challenges and a risky balance sheet weigh heavily. Technical analysis suggests caution, and the valuation highlights market wariness. Positively, the earnings call underscored strategic growth in subscriptions and AI integration, although it also pointed to potential risks.

Positive Factors

AI Strategy

Appian is experiencing strong demand for its new AI solutions, with AI usage growing significantly and nearly half of new customers adopting the company's premium AI offerings.

Earnings

Appian reported solid first-quarter results that outperformed consensus on most key metrics.

Negative Factors

Execution Challenges

Appian trades at a lower multiple compared to its peers, reflecting recent execution challenges and a muted profitability profile.

Market Risks

Risks to the outlook include the rate of market adoption for low-code solutions and competition from larger software providers.

Appian (APPN) vs. S&P 500 (SPY)

Market Cap

$2.27B

Dividend YieldN/A

Average Volume (3M)592.22K

Price to Earnings (P/E)―

Beta (1Y)1.39

Revenue Growth13.15%

EPS Growth43.36%

CountryUS

Employees2,033

SectorTechnology

Sector Strength66

IndustrySoftware - Infrastructure

Share Statistics

EPS (TTM)0.13

Shares Outstanding42,957,027

10 Day Avg. Volume568,652

30 Day Avg. Volume592,216

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.14

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit5.56

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$34.50

Price Target Upside7.71% Upside

Rating ConsensusHold

Number of Analyst Covering7

Appian Business Overview & Revenue Model

Company DescriptionAppian 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. It serves to financial services, government, life sciences, insurance, manufacturing, energy, healthcare, telecommunications, and transportation industries. The company was incorporated in 1999 and is headquartered in McLean, Virginia.

How the Company Makes MoneyAppian makes money primarily through the sale of subscriptions to its low-code automation platform. These subscriptions provide clients access to the platform's suite of tools for building and managing applications. The company also generates revenue from professional services, which include training, support, and consulting to help customers effectively implement and utilize the platform. Additionally, Appian benefits from strategic partnerships and collaborations that enhance its market reach and product offerings, thus contributing to its overall earnings.

Appian Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Highlights revenue from different business units, indicating which segments are driving growth and where the company might focus its strategic efforts.

Chart InsightsAppian's subscription revenue shows robust growth, driven by strong cloud subscription performance, which increased by 19% in Q4 2024. This aligns with the company's strategic focus on cloud services and successful upselling efforts. Despite a slight decline in revenue retention rate, customer retention remains high, supporting sustained revenue growth. However, challenges such as foreign exchange losses and potential impacts from US federal spending uncertainty could affect future performance. Overall, Appian's strategic initiatives are yielding positive results, with expectations of continued revenue growth in 2025.

Data provided by:

Main Street Data

Appian Financial Statement Overview

Summary

Appian is experiencing strong revenue growth, as evidenced by a jump to $617M in 2024. However, profitability is a concern with persistent negative net income and EBIT margins. The balance sheet shows potential instability with negative equity, though cash flow has improved significantly.

Income Statement

―

Appian's revenue has shown consistent growth over the past years, increasing from $260.4M in 2019 to $617.0M in 2024. This reflects a strong upward trajectory. However, profitability remains a challenge, as evidenced by persistent negative net income and EBIT margins. Despite an improving gross profit margin, the net profit margin remains negative due to high operating expenses.

Balance Sheet

Appian's balance sheet shows a concerning trend with negative stockholders' equity in the latest year, indicating potential financial instability. The debt-to-equity ratio is not meaningful due to negative equity, reflecting high leverage risks. However, the company has maintained a healthy cash position, which could provide some buffer against its liabilities.

Cash Flow

―

Appian has demonstrated significant improvement in cash flow, with positive free cash flow in the latest year, a remarkable turnaround from previous periods of negative cash flow. The operating cash flow to net income ratio indicates the company's ability to convert its operations into cash, suggesting better cash management despite ongoing net losses.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
617.02M	545.36M	467.99M	369.26M	304.57M
	Gross Profit
466.84M	402.04M	334.69M	265.17M	215.81M
	EBIT
-60.85M	-107.97M	-145.01M	-83.91M	-37.90M
	EBITDA
-57.60M	-80.90M	-141.26M	-81.75M	-26.27M
	Net Income Common Stockholders
-92.26M	-111.44M	-150.92M	-88.64M	-33.48M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
159.86M	159.00M	196.00M	155.97M	222.29M
	Total Assets
621.04M	627.50M	594.21M	504.52M	512.52M
	Total Debt
305.39M	277.35M	184.03M	56.89M	58.12M
	Net Debt
186.84M	128.00M	35.89M	-43.90M	-54.34M
	Total Liabilities
653.68M	575.16M	448.51M	270.60M	215.92M
	Stockholders Equity
-32.64M	52.34M	145.70M	233.92M	296.61M
Cash Flow		Free Cash Flow
3.08M	-120.08M	-115.65M	-59.98M	-8.87M
	Operating Cash Flow
6.88M	-110.44M	-106.55M	-53.92M	-7.62M
	Investing Cash Flow
-35.39M	28.59M	10.26M	41.94M	-153.36M
	Financing Cash Flow
-258.00K	79.17M	142.87M	2.79M	110.47M

Appian Technical Analysis

Technical Analysis Sentiment

Positive

Last Price32.03

Price Trends

50DMA

29.72

Positive

100DMA

32.00

Positive

200DMA

33.02

Negative

Market Momentum

MACD

0.61

Negative

RSI

62.65

Neutral

STOCH

45.43

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APPN, the sentiment is Positive. The current price of 32.03 is above the 20-day moving average (MA) of 29.31, above the 50-day MA of 29.72, and below the 200-day MA of 33.02, indicating a neutral trend. The MACD of 0.61 indicates Negative momentum. The RSI at 62.65 is Neutral, neither overbought nor oversold. The STOCH value of 45.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for APPN.

Appian Risk Analysis

Appian disclosed 57 risk factors in its most recent earnings report. Appian reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Appian Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FOUR	76 Outperform	$7.35B	28.05	30.28%	―	27.39%	115.40%
KVYO	76 Outperform	$8.76B	―	-4.73%	―	33.95%	87.03%
ZS	74 Outperform	$36.07B	―	-1.21%	―	27.77%	89.39%
S	64 Neutral	$6.18B	―	-17.68%	―	32.25%	20.56%
Sector *	60 Neutral	$10.83B	10.47	-6.71%	2.99%	7.73%	-12.97%
APPN	58 Neutral	$2.27B	―	-936.62%	―	13.15%	43.36%
CFLT	55 Neutral	$6.72B	―	-34.18%	―	24.11%	21.87%

* Technology Sector Average

Performance Comparison

APPN

Appian

32.03

0.37

1.17%

Zscaler

233.15

61.19

35.58%

FOUR

Shift4 Payments

85.43

24.40

39.98%

CFLT

Confluent

20.98

-10.05

-32.39%

SentinelOne

19.41

-1.80

-8.49%

KVYO

Klaviyo, Inc. Class A

33.24

9.16

38.04%

Appian Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q1-2025)

% Change Since: 5.33%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Positive

The earnings call reflected a strong performance in terms of revenue growth and AI integration, with significant improvements in sales and marketing efficiency. However, challenges such as a decline in the cloud subscription revenue retention rate and stagnant professional services revenue were noted. The guidance for Q2 suggests caution in expectations, but the overall sentiment leans positively due to the ongoing growth and strategic advancements.

Q1-2025 Updates

Positive Updates

Cloud Subscription Revenue Growth

Appian's cloud subscription revenue grew 15% year-over-year to $99.8 million.

Adjusted EBITDA Performance

Adjusted EBITDA was $16.8 million, a strong follow-up to the prior quarter's adjusted EBITDA of $21.2 million.

AI Integration Success

70% of Appian's cloud customers have adopted AI, with year-over-year production AI usage increasing by 7.9 times in Q1 compared to all of 2024.

Federal Government Bookings Growth

Federal Government bookings, including both net new software and services, grew 59% compared to the same period last year.

AI Monetization

Revenue from AI-inclusive tiers more than doubled in Q1 relative to Q4, rising to $9 million.

Sales and Marketing Efficiency

Net new bookings per sales rep rose more than 30% compared to the same period last year.

Strong Cash Flow

Cash provided by operations was $45 million compared to $18.9 million for the same period last year.

Negative Updates

Cloud Subscription Revenue Retention Rate Decline

The cloud subscription revenue retention rate decreased to 112% as of March 31, 2025, from 120% a year ago.

Professional Services Revenue Stagnation

Professional services revenue was $32.1 million, showing flat growth compared to the first quarter of 2024.

Q2 Adjusted EBITDA Guidance

Expected adjusted EBITDA for Q2 2025 is between negative $5 million and negative $2 million.

Company Guidance

During Appian's Q1 2025 earnings call, the company provided several key financial metrics and guidance. Cloud subscription revenue increased by 15% year-over-year to $99.8 million, while total subscription revenue grew by 14% to $134.4 million. The company reported a cloud subscription revenue retention rate of 112% as of March 31. Adjusted EBITDA was $16.8 million, a solid follow-up from the previous quarter's $21.2 million. Appian's weighted rule of 40 score was 27 for the quarter, and they noted a 30% increase in net new bookings per sales rep. For Q2 2025, Appian anticipates cloud subscription revenue between $101 million and $103 million, with total revenue ranging from $158 million to $162 million. For the full year 2025, the company expects cloud subscription revenue between $419 million and $423 million and total revenue between $680 million and $688 million. Adjusted EBITDA for the year is projected to range between $40 million and $46 million.

Appian Corporate Events

Executive/Board Changes

Appian Appoints New CFO Serge Tanjga

Positive

Apr 21, 2025

On April 21, 2025, Appian Corporation announced the appointment of Serge Tanjga as Chief Financial Officer, effective May 27, 2025. Tanjga, who brings over 20 years of financial experience, including roles at MongoDB and Emerging Sovereign Group, will succeed Mark Lynch and report directly to CEO Matt Calkins. His appointment is expected to strengthen Appian’s financial leadership and strategic planning capabilities, potentially impacting its market positioning positively.

Spark’s Take on APPN Stock

According to Spark, TipRanks’ AI Analyst, APPN is a Neutral.

Appian demonstrates strong revenue growth and improved cash flow, but persistent profitability challenges and a risky balance sheet weigh heavily on its overall score. Technical analysis suggests a bearish trend, and valuation reflects market caution. Positively, the earnings call highlights strong subscription growth and customer retention, though it also points to potential risks.

To see Spark’s full report on APPN stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.