AppFolio APPF shares have gained 32.8% in the year-to-date period, outperforming the Zacks Computer Technology sector, Zacks Internet Software industry and the S&P 500’s return of 25.7%, 25.2% and 23.4%, respectively. AppFolio’s outperformance reflects investors’ confidence in the company’s innovative portfolio.
Throughout 2024 and 2023, AppFolio has enriched its product portfolio with multiple product launches. These product introductions include AppFolio Alpha, Realm-X and AppFolio FolioSpace. APPF has also added enhancements to these products.
AppFolio’s Realm-X simplifies property management with AI-driven tools. The company recently enhanced this platform with features like Realm-X Assistant, Realm-X Messages and Realm-X Flows. These features improve Realm-X’s capabilities in report generation, vendor interaction, personalized communications, tailored responses and workflow automation.
AppFolio’s recent introduction of FolioSpace focuses on improving property managers’ engagement with residents in a single digital platform. The product simplifies the resident application process, screening and onboarding. FolioSpace also provides a service marketplace to improve the residential experience. Furthermore, the solution streamlines communication by enabling customers to put maintenance requests and leasing questions. All these requests and queries are managed by an AI-powered response system.
AppFolio YTD Performance
Image Source: Zacks Investment Research
AppFolio Leverages AI for Smoother Customer Migrations
AppFolio is making ample use of AI in improving its user experience. APPF’s user base comprises land owners, real estate investors, housing associations, property managers and rental managers. These customers are often dissuaded by the lengthy onboarding process, which involves manual data migration and system setup.
Since the long onboarding and migration process makes customers reluctant to switch from one property management software to another, AppFolio has automated most of its processes, a large part of which involves AI. Currently, APPF’s property management software holds the largest market in the United States, according to a report by 6sense.
The recent addition of generative AI features in AppFolio’s software enables customers to input their financial, business and other foundational data into the platform at their own pace. The platform leverages a conversational AI assistant, Realm-X, to reduce repetitive tasks, complete tasks, and resolve queries.
AppFolio Benefits From Strong Partner Base
AppFolio has a long history of automating customers’ tasks to improve user experience. APPF has partnered with DocuSign DOCU, AvidXchange AVDX and Amazon AMZN to automate and streamline its products.
AppFolio partnered with DocuSign in 2021 to automate and streamline its signing process through electronic signature. APPF partnered with AvidXchange for streamlining the processing of invoices and payments. AppFolio and Amazon have collaborated to automate real estate and package management by integrating AppFolio Property Manager and Amazon Apartment Locker.
APPF’s persistent efforts to improve its offerings have contributed to its customer base. The company had 20,403 customers in the third quarter of 2024, which grew 5.1% year over year from 19,418 customers.
The company expects its 2024 revenues to be in the range of $786-$790 million. The Zacks Consensus Estimate for the same is pegged at $791 million, indicating year-over-year growth of 27.5%.
The Zacks Consensus Estimate for earnings is pegged at $4.41, indicating year-over-year growth of 158%.
What Should Investors Do?
AppFolio’s strong product base and robust financials are likely to drive this Zacks Rank #2 (Buy) stock upward in the near term.
Considering all these factors, we suggest investors to buy AppFolio at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
