Please ensure Javascript is enabled for purposes of website accessibility

Why Appian Stock Dipped Today

By Evan Niu, CFA - Feb 17, 2021 at 11:57AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Cowen reiterates a neutral rating on Appian ahead of its fourth-quarter earnings release.

What happened

Shares of Appian (APPN 9.45%) have dipped by as much as 5% after a Wall Street analyst reiterated a neutral view on the company. Cowen maintained a "market perform" (equivalent to neutral) rating on Appian while analyst Derrick Wood adjusted his price target from $83 to $175. The tweak comes as the broader market is selling off, with tech stocks getting hit particularly hard.

So what

The analyst notes that Appian shares have experienced a "profound" rerating, as the stock had nearly tripled since Appian reported third-quarter results in November. That has created some concerns around the company's valuation, in Wood's view.

Red stock chart going down

Image source: Getty Images.

"Fundamentals are solid, but there have not been any major new developments & we think short squeeze dynamics are at play," Wood wrote in a research note to investors. "Valuations seem stretched which we feel creates more downside risks."

Now what

Appian is scheduled to report fourth-quarter results tomorrow  after the close. The company's guidance calls for total revenue in the range of $73 million to $74 million, of which $35 million to $35.5 million should be cloud subscription revenue. Adjusted EBITDA is forecast at negative $10 million to negative $11 million. Adjusted net loss per share is expected to be $0.16 to $0.18 per share. The consensus estimate currently sits at $74 million in sales and an adjusted net loss of $0.17 per share.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Appian Stock Quote
Appian
APPN
$55.04 (9.45%) $4.75

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
336%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.