Appfolio Inc (APPF)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 23.36% | 10.64% | 22.55% | 53.65% | 24.14% |
| Operating profit margin | 0.15% | -15.16% | -3.30% | 1.97% | 2.54% |
| Pretax margin | 1.27% | -13.98% | 0.48% | 39.69% | 1.90% |
| Net profit margin | 0.43% | -14.27% | 0.29% | 31.94% | 14.26% |
Appfolio Inc's profitability ratios have shown significant fluctuations over the past five years. The gross profit margin, which indicates the percentage of revenue remaining after deducting the cost of goods sold, has been inconsistent, with a notable peak in 2020 at 53.65% but dropping to 10.64% in 2022 before recovering slightly to 23.36% in 2023.
The operating profit margin, representing the proportion of revenue left after deducting operating expenses, has been volatile, ranging from negative figures in 2022 and 2023 to positive margins in earlier years. This suggests challenges in controlling operating costs and generating sustainable profits from core business activities.
The pretax margin, indicating the proportion of revenue remaining after deducting all operating expenses and before taxes, has exhibited a significant decline from 39.69% in 2020 to negative figures in 2022 and a small recovery to 1.27% in 2023. This trend reflects fluctuations in operating efficiency and the impact of non-operating items on overall profitability.
Lastly, the net profit margin, which shows the percentage of revenue left after deducting all expenses including taxes, has shown inconsistent performance with negative margins in 2019 and 2022, compared to profitable margins in other years. This indicates variability in managing tax liabilities and controlling other expenses to generate bottom-line profitability.
Overall, Appfolio Inc's profitability ratios suggest a lack of consistent profitability over the past five years, highlighting the need for the company to focus on cost management, revenue generation, and operational efficiency to drive sustainable and improved financial performance.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 0.24% | -18.98% | -2.91% | 2.51% | 2.48% |
| Return on assets (ROA) | 0.66% | -17.87% | 0.25% | 40.67% | 13.95% |
| Return on total capital | 0.32% | -27.25% | -3.99% | 3.42% | 3.60% |
| Return on equity (ROE) | 0.91% | -25.65% | 0.35% | 55.40% | 27.50% |
Appfolio Inc's profitability ratios have shown significant fluctuations over the past five years. In terms of Operating ROA, the company recorded 0.24% in 2023, a notable improvement compared to the negative figures in the previous two years. This indicates that the company generated a modest return from its operating activities relative to its assets in 2023.
When considering the overall performance, ROA improved to 0.66% in 2023, rebounding from negative returns in the two prior years. This signals that the company's overall asset utilization and profitability improved in 2023.
However, Return on Total Capital remained relatively low at 0.32% in 2023, albeit showing an increase from the previous year. This suggests that the company may still have room to enhance its performance in effectively utilizing its total capital to generate returns.
On the other hand, ROE increased to 0.91% in 2023, reflecting a positive trend in the company's ability to generate returns for its equity holders. Despite the improvement, ROE remains relatively low compared to previous years with significantly higher figures.
Overall, Appfolio Inc exhibited mixed profitability performance in 2023, with some ratios showing improvements while others remain at relatively lower levels. It is important for the company to continue monitoring and optimizing its profitability metrics to ensure sustainable growth and value creation for its stakeholders.