Why Appian Is Still a Buy After Q4 2020 Earnings
Shares of low-code software development platform Appian (NASDAQ: APPN) exploded higher in the fourth quarter of 2020. The stock price is up some 200% since the start of October, getting a massive lift as traders betting against the technologist closed down their positions, creating a short squeeze.
Given the premium price Appian now trades for, a lot was riding on its fourth-quarter 2020 report and initial outlook for 2021. Expect plenty of volatility ahead, but Appian nonetheless remains a top software development and AI investment for the long term.
Though many of its customers and potential customers were deeply impacted by lockdowns to slow the spread of COVID-19, Appian ended up having a pretty good year. Subscriptions to its library of software development toolkit was the primary driver of growth as well as the expansion of gross profit margin on services rendered. As expected, as Appian adds more users and reaches a more efficient scale, it's quickly narrowing the gap on adjusted EBITDA and free cash flow breakeven.
Source Fool.com
