3 Reasons Why Growth Investors Shouldn't Overlook AppFolio (APPF)

Core Viewpoint - Growth stocks are appealing due to their above-average financial growth, but identifying strong growth stocks can be challenging due to inherent volatility and risks [1] Group 1: Company Overview - AppFolio (APPF) is highlighted as a recommended growth stock based on the Zacks Growth Style Score, which evaluates a company's real growth potential beyond traditional metrics [2] - The company has a favorable Growth Score and a top Zacks Rank, indicating strong investment potential [2] Group 2: Earnings Growth - AppFolio has a historical EPS growth rate of 17.5%, with projected EPS growth of 18.8% this year, surpassing the industry average of 18.6% [4] - Earnings growth is crucial for investors, particularly double-digit growth, which signals strong future prospects [3] Group 3: Cash Flow Growth - The year-over-year cash flow growth for AppFolio is 170.5%, significantly higher than the industry average of -17.8% [5] - The company's annualized cash flow growth rate over the past 3-5 years is 16.5%, compared to the industry average of 14.7% [6] Group 4: Earnings Estimate Revisions - Positive trends in earnings estimate revisions are correlated with stock price movements, and AppFolio's current-year earnings estimates have been revised upward by 1.4% over the past month [7][8] Group 5: Investment Conclusion - AppFolio has achieved a Growth Score of A and a Zacks Rank of 2, indicating it is a solid choice for growth investors and a potential outperformer [9][10]