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AppFolio's (APPF) Q2 Earnings Lag Estimates, Revenues Up Y/Y

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AppFolio, Inc. APPF reported second-quarter 2021 earnings of 6 cents per share compared with earnings of 54 cents reported in the year-ago quarter. The Zacks Consensus Estimate was pegged at earnings of 7 cents per share.

Total revenues of $89 million increased 10% on a year-over-year basis in the second quarter. The Zacks Consensus Estimate was pegged at $89.4 million for the second quarter.

Excluding the impact of MyCase divestment, revenues from continuing real estate business increased 22% year over year. The company concluded the sale of its wholly-owned subsidiary company, MyCase, for $193 million on Sep 30, 2020.

In the past year, AppFolio shares have declined 12.5% against the industry’s rally of 27.8%.

AppFolio, Inc. Price, Consensus and EPS Surprise

AppFolio, Inc. Price, Consensus and EPS Surprise
AppFolio, Inc. Price, Consensus and EPS Surprise

AppFolio, Inc. price-consensus-eps-surprise-chart | AppFolio, Inc. Quote

Segment Revenue Details

Core Solutions’ revenues were $25.4 million, down 3% on a year-over-year basis.

Core solutions revenues from subscriptions to customers from continuing real estate business in the second quarter rallied 20% year over year.

Value+ Services revenues came in at $60.4 million, up 17% year over year. The segment’s top line was driven by higher uptake of the company’s electronic payment services.

Value+ Services revenues from continuing business in the second quarter increased 25% year over year.

Other revenues were down 5% year over year to $3.2 million in the quarter under review.

In the second quarter, number of property manager customers increased 10% year over year to 16,532. The number of property management units increased 5.82 million units from 4.94 million units reported in the year-ago quarter.

Amid the ongoing pandemic, the need to maintain social distancing is driving demand for online leasing services and virtual showings. The company is also optimistic about its tenant screening and insurance services solutions.

Management also added new capabilities like rental history verification and lease renewal proration to its AppFolio Property Manager solution to help clients boost revenue retention rates.

Margins

Total costs and operating expenses of $87.8 million, increased 17.7% year over year. This was caused by increases in headcount as well as higher third-party transactional costs and online advertising and virtual marketing event expenses.

Meanwhile, the company reported income from operations of $1.2 million compared with income from operations of $6.4 million reported in the year-ago quarter.

Balance Sheet

As of Jun 30, 2021, AppFolio’s cash and cash equivalents (and investment securities) came in at $163.1 million compared with $160 million as of Mar 31, 2021.

In the second quarter, cash provided by operating activities stood at $15.1 million compared with $4.4 million of cash used in the previous quarter.

Guidance

For 2021, AppFolio expects revenues in the range of $350-$355 million.

The Zacks Consensus Estimate for the third quarter and 2021 revenues is currently pegged at $93.3 million and $352.3 million, respectively.

The consensus mark for earnings per share for the third quarter and 2021 are currently pegged at 8 cents and 20 cents, respectively.

Zacks Rank & Stock to Consider

AppFolio currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector are Avnet AVT, CyberArk Software CYBR and CACI International CACI. Avnet sports a Zacks Rank #1 (Strong Buy), while CACI and CyberArk carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Avnet and CACI are scheduled to report their quarterly results on Aug 11, while CyberArk is slated to announce results on Aug 12.

Long-term earnings growth rate of Avnet, CyberArk and CACI is pegged at 22.7%, 12.2% and 13.1%, respectively.


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