AppFolio — APPF

AppFolio — APPF
https://www.appfolio.com/

Technicals:
RSI — 42.79
Below MA20 & MA10
MACD close to signal line
Traded sideways since ~1/13/21

Fundamentals:
Q3 20 significant EPS beat (3.86 vs. 0.17 est.)
Generally in-line with EPS estimates in 2020
2018 EPS -> 0.56
2019 EPS -> 1.02
2020 EPS (EST) -> 4.52 (sold MyCase to PE firm)
~44% — 78% Institutionally Owned
Shorts -> 4.85% (low -> bullish sentiment)
Interest rate will remain low through 2021, making it relatively cheap to aquire real estate.

Based on recent price movements from a low point to high point, if those trend holds, there could be 20–25% upside.
Two recent instances of MACD crossing signal line up, at a low price point.
9/30/20–141 -> climbed to 169 on 10/13/20
11/24/20–144 -> climbed to 184 on 12/28/20

Risks:
Growth could be slowing
Could be a false indicator (misread indicators, trend false)
Price could still have some downside before turning (misread indicators, trend valid)
People might be looking to offload commercial real estate after 2020.
Commercial real estate could be hurt from continued switch to work from home.
On the other side, if commercial real estate rebounds, the demand for property management solutions could increase.

Products:
AppFolio Property Manager
An all-in-one solution with accounting, marketing, leasing, and management functionality for multifamily and single-family, commercial, student housing, community association, and mixed portfolio property managers.

AppFolio Investment Management
An all-in-one software solution designed for real estate investment management, with tools for fund management and syndication.

Trade Details:
Position: 10 @ 155.82
High Target: 193 (+25%)
Low Target: 186 (+20%)
Will look for exit above 180, depending on technicals
Set stop loss at 131 (-15%)
Trade Timeline: 2–5 weeks

Potential for downside loss greater than 15% seems very low given historical trends.

RATING: BIG PP