Piper Sandler has lowered its price objective on AppFolio (NASDAQ:APPF) to $245.00 from $350.00 but maintained an Overweight rating on the property management software provider. The revised target equates to about an 18% upside from AppFolio's recent share price of $207.10.
The change follows AppFolio's 2026 revenue-growth guidance, which carries a midpoint of 16.7% - below the Wall Street expectation of 18.5%. That guidance prompted an after-hours sell-off, with the company's stock falling approximately 12% following the announcement, despite AppFolio having delivered 18.9% revenue growth over the last twelve months.
In its commentary, Piper Sandler described the market's reaction to the guidance as "overdone." The firm highlighted operational points from AppFolio's most recent quarter that it views as constructive, including an acceleration in unit growth to 8% year-over-year in the fourth quarter, up from 7% in the prior quarter, along with expansion in core average revenue per user.
Third-party InvestingPro data referenced by market watchers indicates AppFolio is trading slightly below its Fair Value and carries a PEG ratio of 0.63, a figure that suggests valuation is low relative to expected growth. Piper Sandler also pointed to the company's 2026 operating-margin guidance of 25.5% to 27.5%, whose midpoint of 26.5% modestly exceeds consensus estimates of 26.2%.
Despite the lowered price target, Piper Sandler reiterated confidence in multiple growth levers for AppFolio - specifically, adoption of premium-tier offerings, ongoing product innovation, potential monetization of artificial intelligence capabilities, and disciplined execution on margins.
Recent quarterly results lent support to those views. AppFolio reported fourth-quarter 2025 earnings per share of $1.39, ahead of the $1.25 analysts had forecast. Revenue in the quarter came in at $248 million, beating the $246.56 million consensus.
Other firms reacted to the quarter and guidance as well. KeyBanc trimmed its price target to $255 from $270 while keeping an Overweight rating. William Blair maintained an Outperform rating, citing accelerating unit additions, revenue growth and "exceptional" free cash flow. AppFolio posted revenue-growth acceleration for the third consecutive quarter, registering 21.9% year-over-year, and unit growth accelerated for a second straight quarter to 8%.
Taken together, the data present a mixed signal: near-term revenue guidance that disappointed market expectations triggered a sharp share-price response, while underlying operational metrics and margin guidance offer reasons for analyst optimism. Investors and market participants will likely weigh these competing threads as they assess the company's near-term outlook and valuation.