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What's in the Offing for AppFolio (APPF) This Earnings Season?

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AppFolio (APPF - Free Report) , a leading provider of cloud-based software solutions for property management and legal industries, is scheduled to report results for the second quarter of 2024 on Jul 25.

For the second quarter of 2024, the Zacks Consensus Estimate for revenues is pegged at $188.3 million, which suggests growth of approximately 28% from the year-ago quarter. The consensus mark for non-GAAP earnings is pegged at 92 cents per share, revised upward by a penny over the past 60 days. The figure indicates a robust four-fold improvement from the year-ago quarter’s earnings of 23 cents per share.

AppFolio’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 56.6%.

In the last reported financial results for the first quarter of 2024, AppFolio’s revenues and earnings per share surpassed the respective Zacks Consensus Estimate. Its first-quarter earnings of $1.05 per share came in 25% above the consensus estimate of 84 cents and marked a robust improvement from the year-ago quarter’s loss of a penny.

AppFolio also surpassed top-line estimates with first-quarter sales of $187.4 million, beating expectations by 7.9%. Quarterly revenues also grew 38% from the year-ago quarter’s sales of $136.1 million.

Let’s see how things have shaped up before the announcement.

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

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

Factors to Consider

AppFolio's second-quarter performance is likely to have benefited from the robust demand for its property management software suite from real estate professionals, property managers and landlords. The company's innovative solutions offer efficiency, scalability and automation, driving adoption and revenue growth.

AppFolio’s targeted marketing efforts and sustained focus on product enhancements are anticipated to have aided customer growth in the to-be-reported quarter. Its artificial intelligence (AI)-enabled products, including AppFolio Realm and AppFolio Property Manager PLUS, are witnessing rapid adoption, which is driving customer growth.

The company ended the first quarter of 2024 by managing approximately 8.3 million property units from 19,941 customers, which was a robust increase from managing 7.5 million units with 18,834 customers at the end of the first quarter of 2023. We expect the trend to continue in the second quarter of 2024 as well. The acquisition of new customers and the retention of existing ones are expected to contribute positively to APPF's top-line growth in the to-be-reported quarter.

Additionally, AppFolio’s collective focus on enhancing operational efficiency is likely to have boosted profitability in the second quarter. In the first quarter of 2024, the combined sales and marketing, research & development, and general & administrative expenses as a percentage of revenues fell to 37% from 57% in the year-ago quarter due to growth in revenues and a collective focus on operational efficiency.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for AppFolio this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.

Though AppFolio sports a Zacks Rank #1, it has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Per our model, PayPal (PYPL - Free Report) , Arista Networks (ANET - Free Report) and Corning (GLW - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.

PayPal sports a Zacks Rank #1 and has an Earnings ESP of +2.96%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is slated to report second-quarter 2024 results on Jul 30. Its earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while matching on one occasion, with the average surprise being 8%.

The Zacks Consensus Estimate for PayPal’s second-quarter earnings stands at 96 cents per share, down 17.2% from the year-ago quarter. It is estimated to report revenues of $7.78 billion, which suggests an increase of 6.8% from the year-ago quarter.

Arista Networks sports a Zacks Rank #1 and has an Earnings ESP of +0.95%. The company is scheduled to report second-quarter 2024 results on Jul 30. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 15.4%.

The Zacks Consensus Estimate for Arista Networks’ second-quarter earnings is pegged at $1.94 per share, which indicates a year-over-year increase of 22.8%. The consensus mark for revenues stands at $1.64 billion, which calls for a year-over-year jump of 12.4%.

Corning is slated to report second-quarter 2024 results on Jul 30. The company sports a Zacks Rank #1 and an Earnings ESP of +1.59% at present. Corning’s earnings beat the Zacks Consensus Estimate once in trailing four quarters while missing the same on two occasions and matching one time, the average surprise being 0.2%.

The Zacks Consensus Estimate for second-quarter earnings is pegged at 46 cents per share, which suggests an increase of 2.2% from the year-ago quarter’s earnings of 45 cents. Corning’s quarterly revenues are estimated to improve 0.3% year over year to $3.49 billion.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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