Market Concerns Push AppFolio Stock into Questionable Territory

With the Nasdaq in correction territory, AppFolio APPF may be a tech stock investors want to steer clear of for now.

Current Profit-Taking Opportunity for APPF

Investors might consider taking profits from AppFolio’s shares, which have dropped 10% in 2025. However, the stock still enjoys over 90% gains over the past three years, outperforming the broader indices, which have risen around 20% during the same period.

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Despite expectations for a 20% growth in EPS for fiscal 2025 and FY26, AppFolio has seen a decline in earnings estimate revisions over the past 60 days. This decline mirrors the situation faced by CoStar Group CSGP.

In the chart below, the Consensus EPS trend for AppFolio is displayed, along with data on private market competitors like RealPage and Yardi Systems.

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AppFolio’s Valuation Compared to Market

The drop in EPS estimates does not necessarily indicate a sell signal. However, APPF is currently trading above $220 and has a forward P/E ratio of 40.9, raising investor concerns about the premium paid for stock in a market cautious of high valuations.

Thus, APPF trades at a significant premium compared to the S&P 500’s forward earnings multiple of 21.2 and the Zacks Internet-Software Industry average of 26.2.

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Conclusion

Given the increasing competition from emerging property management solution providers, the excitement surrounding AppFolio’s stock could diminish. Consequently, another decline in APPF shares seems plausible, particularly as the Nasdaq continues to navigate through correction territory.

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AppFolio, Inc. (APPF): Free Stock Analysis report

CoStar Group, Inc. (CSGP): Free Stock Analysis report

This article originally published on Zacks Investment Research (zacks.com).

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.