Appian: The Pullback Is Creating A Long-Term Buying Opportunity

Oct. 19, 2018 9:41 AM ETAppian Corporation (APPN)15 Comments
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WG Investment Research


  • Appian's stock has not performed well lately but the company's long-term bull case is still intact.
  • Appian is a low-code, small-cap technology company that is worthy of investment dollars.
  • I am long Appian and I plan to build the position in the months/quarters ahead.
  • This idea was discussed in more depth with members of my private investing community, Going Long With W.G.. Start your free trial today »

Appian Corporation (NASDAQ:APPN) is a small-cap company that I own in the R.I.P. Portfolio. Appian has performed well since the company IPO'ed in mid-2017 but the stock has significantly underperformed the broader market on a YTD basis.

ChartAPPN data by YCharts

While the stock has not performed well over the last 10 months, I still believe that Appian has great long-term business prospects. Therefore, I view the recent pullback as a buying opportunity if you are willing (and able) to hold onto the stock for the next three to five years.

About The Business

Appian is a 'low-cost, low-code' software development company that allows customers to develop applications on its platform. The company's customers are able to use its cloud-based platform to code apps and Appian's approach - simplistic coding that allows for people with limited coding knowledge to easily design, build, and implement apps at attractive prices - really sets itself apart from competitors.

Appian has significantly grown its top line since the IPO and I believe that the future looks just as bright.

ChartAPPN Revenue (Annual) data by YCharts

More importantly, the company has been able to keep the growth going over the last few quarters, as shown by the fact that Appian again reported a top line beat in its most recent quarter. The company reported an adjusted loss per share of $0.14 (beat by $0.03) on revenue of $59.88M (beat by $9.61M) for Q2 2018.

Financial highlights from the quarter:

It is all about building and expanding at this stage, so there was a lot to like about the company's operating results. 39% YoY revenue growth is something to write home about it, and let's not forget that the net revenue retention figure (119%) shows that management is keeping customers happy.

On the negative front, the consolidated

This article was written by

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Our President and CIO is a CPA with experience in public accounting and the financial services industry. He earned his Master of Accountancy degree in 2008 and his B.S. in Business Management in 2007. He is also a Level III CFA candidate. He has been intrigued by the market from the start. Over the years, he has learned that long-term investing is a discipline that, if followed, will help contribute to building lasting wealth. As such, most of our articles will be about the investments that we plan to hold for at least 3 to 5 years, as long as the company's story does not change. As a Seeking Alpha contributor, our main goal is to write about the companies that are key to our portfolio with the hope of promoting discussion (for or against the investment) from others within the SA community.Please visit our website for more information about W.G. Investment Research LLC.

Disclosure: I am/we are long APPN. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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