What happened
Shares of unprofitable tech stocks Appian (APPN 0.60%), Okta (OKTA -0.60%), and Shopify (SHOP -3.05%) all popped in Friday trading, closing 4.6%, 5.7%, and 5.8% higher, respectively.
Image source: Getty Images.
So what
Were today's rising prices a harbinger of even better days to come, or just a gift: a day in which stock prices rise for no reason, giving investors a chance to cash out at a profit?
Lacking any real news underlying the rising share prices, I'm more inclined to think the latter, especially in the case of Appian. None of these three tech stocks is currently profitable, but at least Okta and Shopify are growing sales strongly. Sales for Okta, an identity- and access-management company, grew 43% in the most recent quarter. Shopify, which provides an e-commerce platform, saw its sales rise 97%. Appian, which offers a low-code platform for app developers, showed only 2% sales growth in the second quarter.
Now what
Analysts also see Appian as the company least likely to turn profitable anytime soon. According to data compiled by S&P Global Market Intelligence, most analysts foresee Shopify becoming GAAP profitable in 2022, and Okta two years later. Analysts following Appian, on the other hand, don't yet have a firm date for when they think it will make money.
Should Appian surprise investors with a renewed spurt of sales growth, the stock could respond positively. But as things stand right now, with no profits today and no prospects for them, Appian stock looks the most vulnerable of the three.
