We recently published a list of 5 Stocks That Analysts Are Bearish On. In this article, we are going to take a look at where AppFolio, Inc. (NASDAQ:APPF) stands against other stocks that analysts are bearish on.
The S&P 500 is up 0.19% while the Dow index has surged up 0.31%. As the broader market booms, there are a few stocks that are lagging the market. Some of these stocks have a bearish outlook and the analysts are adjusting their ratings accordingly.
While the US economy seems comfortably on the path of recovery, certain sectors have more risks associated with them. In other cases, stocks receive a downgrade when they have already run up considerably and analysts do not see more upside despite better earnings and macroeconomic environment. For investors, it is vital to understand why stocks receive a downgrade so they can plan to shift their investments accordingly.
We looked at 5 stocks that analysts are bearish on. To come up with the list of 5 stocks that analysts are bearish on, we looked at stocks that recently received a downgrade and have a market cap of at least $1 billion.
A close-up shot of a user-friendly and customizable interface of the company’s software, designed to suit different workflows.
AppFolio, Inc. (NASDAQ:APPF)
AppFolio, Inc. (NASDAQ:APPF) continues to decline amid management’s lower 2025 growth expectations. According to analyst Jason Celino, this year will be a transitional period as the company exhibits disappointing performance metrics and struggles with leadership restructuring. Considering this, KeyCorp lowered shares of AppFolio to a sector weight from an overweight rating.
Despite AppFolio’s (NASDAQ:APPF) strong financial performance during the last twelve months, many other research analysts also view APPF as a weak stock, reducing the target price by a solid $62, from $193 to $255. The cloud-based platform bid farewell to its CFO, Fay Sien Goon, with rising transitional setbacks influencing the company’s financial strategy and market performance.
But at the same time, the company’s efforts to integrate AI to streamline the work process and collaborate with industry giants like Amazon ensure that the management is undertaking developments to combat the challenges. While collaboration with DocuSign made contract management easy through electronic signatures, the partnership with AvidXchange has enhanced the efficiency of invoice and payment systems. This means that with the stability of the management, the company can fully utilize its contracts.
Overall, APPF ranks 2nd on our list of stocks that analysts are bearish on. While we acknowledge the potential of APPF as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as APPF but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
