Appian (APPN) AI Stock Analysis

• Market Cap: $2.11B
• Dividend Yield: N/A
• Average Volume (3M): 730.89K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.26
• Revenue Growth: 15.97%
• EPS Growth: 91.88%
• Country: US
• Employees: 2,033
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.32
• Shares Outstanding: 42,735,085
• 10 Day Avg. Volume: 937,928
• 30 Day Avg. Volume: 730,890
• PEG Ratio: 1.53
• Price to Book (P/B): -73.75
• Price to Sales (P/S): 3.90
• P/FCF Ratio: 781.54
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 3.47
• Enterprise Value/Gross Profit: 4.54
• Enterprise Value/Ebitda: 84.60
• 1Y Price Target: $40.33
• Price Target Upside: 40.92% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7
• EPS Forecast (FY): 0.74
• Revenue Forecast (FY): $795.63M

• Rating: 49 Neutral
• Price Target: $30.00 ▲(4.82% Upside)

The score is held back primarily by balance sheet risk (negative equity) and weak technicals (below major moving averages with negative MACD). Improving cash flow and strong gross margins help offset some risk, and the latest earnings call was constructive with raised guidance and better EBITDA outlook, but valuation remains unsupported due to a deeply negative P/E and no dividend.

Positive Factors

Recurring cloud subscription model & growth

Recurring cloud subscriptions drive predictable, contractable revenue and were a primary growth engine in Q3. Sustained subscription momentum and raised cloud guidance improve multi-quarter revenue visibility, support upsells, and enhance long-term customer lifetime value.

High gross margins and improving FCF

Very high gross margins reflect scalable SaaS economics and product leverage, while strong free cash flow growth indicates improving cash generation. Together these fundamentals support reinvestment in product, sales, and AI initiatives without immediate reliance on external financing.

Major multi-year US Army Enterprise Agreement

A 10-year Army enterprise agreement and conditional ATO materially expand a stable, long-term federal addressable market. This provides durable pipeline visibility, validates security posture for other government clients, and anchors multi-year license and services demand.

Negative Factors

Negative shareholders' equity / leverage

Negative equity and a skewed debt-to-equity profile signal a fragile capital structure. This constrains borrowing capacity, raises refinancing and covenant risk, and limits strategic flexibility (M&A, large investments) over the medium term if not remedied by consistent profitability or capital raises.

Ongoing unprofitability and thin operating margins

Despite strong gross margins, low-to-negative net and operating margins show the company struggles to scale expenses efficiently. Persistent unprofitability reduces retained earnings buffer, risks investor tolerance, and limits organic funding for growth initiatives absent sustained margin improvement.

Declining cloud subscription retention rate

A declining net retention trend signals weaker upsell or relatively higher churn within the installed base. Even though retention >100% remains positive, a downward trajectory can erode recurring revenue quality and requires continued investment in product value and customer success to sustain long-term growth.

Appian Business Overview & Revenue Model

Company Description

Appian Corporation provides low-code automation platform in the United States and internationally. The company's platform automates the creation of forms, workflows, data structures, reports, user interfaces, and other software elements that are needed to be manually coded. The company also offers professional and customer support services. It serves to financial services, government, life sciences, insurance, manufacturing, energy, healthcare, telecommunications, and transportation industries. The company was incorporated in 1999 and is headquartered in McLean, Virginia.

How the Company Makes Money

Appian generates revenue primarily through its subscription-based model, which includes licensing fees for its software platform, maintenance, and support services. The company offers different tiers of service, catering to a range of business needs from small enterprises to large organizations, thereby diversifying its customer base. Additionally, Appian earns revenue through professional services, such as training, consulting, and implementation support, which help clients maximize the value of their investments in Appian's solutions. Strategic partnerships with other technology providers and system integrators also play a crucial role in enhancing Appian's market presence and driving further revenue growth.

Appian Financial Statement Overview

Summary

Appian demonstrates strong revenue growth and effective cash management, but faces challenges with profitability and financial stability. The high leverage and negative equity are significant risks, while improving cash flows offer some optimism. Continued focus on cost control and reducing leverage will be crucial for future financial health.

Income Statement

Appian's revenue has shown consistent growth, with a TTM revenue growth rate of 5.01%. However, the company is struggling with profitability, as indicated by a negative net profit margin of -2.62% in the TTM. The gross profit margin remains strong at 76.34%, but the EBIT and EBITDA margins are low at 1.40% and 2.93%, respectively, reflecting challenges in controlling operating expenses.

Balance Sheet

The balance sheet reveals significant financial leverage, with a negative debt-to-equity ratio due to negative stockholders' equity. This indicates potential financial instability. The return on equity is positive at 41.06% in the TTM, but this is skewed by the negative equity. The equity ratio is negative, highlighting a concerning financial structure.

Cash Flow

Appian's cash flow situation has improved, with a substantial free cash flow growth rate of 57.96% in the TTM. The operating cash flow to net income ratio is 0.14, indicating some ability to convert earnings into cash. The free cash flow to net income ratio is high at 0.95, suggesting effective cash management despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	690.75M	617.02M	545.36M	467.99M	369.26M	304.57M
Gross Profit	526.94M	466.84M	402.04M	334.69M	265.17M	215.81M
EBITDA	28.31M	-57.60M	-80.90M	-141.26M	-81.75M	-26.27M
Net Income	-7.31M	-92.26M	-111.44M	-150.92M	-88.64M	-33.48M
Balance Sheet
Total Assets	611.74M	621.04M	627.50M	594.21M	504.52M	512.52M
Cash, Cash Equivalents and Short-Term Investments	191.56M	159.86M	159.00M	196.00M	155.97M	222.29M
Total Debt	306.60M	314.99M	277.35M	184.03M	56.89M	58.12M
Total Liabilities	660.28M	653.68M	575.16M	448.51M	270.60M	215.92M
Stockholders Equity	-48.54M	-32.64M	52.34M	145.70M	233.92M	296.61M
Cash Flow
Free Cash Flow	72.65M	3.08M	-120.08M	-115.65M	-59.98M	-8.87M
Operating Cash Flow	75.61M	6.88M	-110.44M	-106.55M	-53.92M	-7.62M
Investing Cash Flow	-28.55M	-35.39M	28.59M	10.26M	41.94M	-153.36M
Financing Cash Flow	-21.90M	-258.00K	79.17M	142.87M	2.79M	110.47M

Appian Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 28.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APPN, the sentiment is Negative. The current price of 28.62 is below the 20-day moving average (MA) of 34.26, below the 50-day MA of 37.93, and below the 200-day MA of 31.97, indicating a bearish trend. The MACD of -2.03 indicates Positive momentum. The RSI at 24.41 is Positive, neither overbought nor oversold. The STOCH value of 8.68 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for APPN.

Appian Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AKAM	73 Outperform	$13.45B	27.41	10.64%	―	4.21%	-0.63%
FOUR	68 Neutral	$5.71B	30.24	15.52%	―	23.16%	27.38%
CFLT	67 Neutral	$10.88B	-33.89	-29.62%	―	21.58%	18.88%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
OKTA	60 Neutral	$16.29B	82.22	2.96%	―	12.12%	―
RBRK	50 Neutral	$13.43B	-34.27	―	―	48.93%	69.39%
APPN	49 Neutral	$2.11B	-287.06	―	―	15.97%	91.88%