APP gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 278 industry peers in the Software industry. APP has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. APP is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make APP suitable for growth and quality investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

APP had positive earnings in the past year.
In the past year APP had a positive cash flow from operations.
In multiple years APP reported negative net income over the last 5 years.
APP had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

Looking at the Return On Assets, with a value of 44.61%, APP belongs to the top of the industry, outperforming 99.28% of the companies in the same industry.
Looking at the Return On Equity, with a value of 191.99%, APP belongs to the top of the industry, outperforming 99.64% of the companies in the same industry.
With an excellent Return On Invested Capital value of 52.42%, APP belongs to the best of the industry, outperforming 98.92% of the companies in the same industry.
APP had an Average Return On Invested Capital over the past 3 years of 14.51%. This is above the industry average of 10.73%.
The last Return On Invested Capital (52.42%) for APP is above the 3 year average (14.51%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	44.61%
ROE	191.99%
ROIC	52.42%

ROA(3y)10.07%

ROA(5y)4.98%

ROE(3y)54.28%

ROE(5y)N/A

ROIC(3y)14.51%

ROIC(5y)9.34%

1.3 Margins

The Profit Margin of APP (51.26%) is better than 93.53% of its industry peers.
APP's Profit Margin has improved in the last couple of years.
APP has a better Operating Margin (63.35%) than 97.84% of its industry peers.
APP's Operating Margin has improved in the last couple of years.
APP has a Gross Margin of 83.31%. This is amongst the best in the industry. APP outperforms 88.85% of its industry peers.
APP's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	63.35%
PM (TTM)	51.26%
GM	83.31%

OM growth 3Y94.93%

OM growth 5Y15.27%

PM growth 3Y209%

PM growth 5Y34.24%

GM growth 3Y5.19%

GM growth 5Y-0.13%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so APP is creating value.
The number of shares outstanding for APP remains at a similar level compared to 1 year ago.
Compared to 5 years ago, APP has less shares outstanding
The debt/assets ratio for APP has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 25.96 indicates that APP is not in any danger for bankruptcy at the moment.
APP has a Altman-Z score of 25.96. This is amongst the best in the industry. APP outperforms 96.76% of its industry peers.
The Debt to FCF ratio of APP is 1.03, which is an excellent value as it means it would take APP, only 1.03 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.03, APP is in the better half of the industry, outperforming 74.82% of the companies in the same industry.
A Debt/Equity ratio of 2.38 is on the high side and indicates that APP has dependencies on debt financing.
APP's Debt to Equity ratio of 2.38 is on the low side compared to the rest of the industry. APP is outperformed by 83.45% of its industry peers.
Although APP does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	2.38
Debt/FCF	1.03
Altman-Z	25.96

ROIC/WACC4.71

WACC11.13%

2.3 Liquidity

APP has a Current Ratio of 3.25. This indicates that APP is financially healthy and has no problem in meeting its short term obligations.
APP has a Current ratio of 3.25. This is in the better half of the industry: APP outperforms 76.98% of its industry peers.
APP has a Quick Ratio of 3.25. This indicates that APP is financially healthy and has no problem in meeting its short term obligations.
APP has a Quick ratio of 3.25. This is in the better half of the industry: APP outperforms 76.98% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	3.25
Quick Ratio	3.25

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 166.36% over the past year.
APP shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 84.83% yearly.
The Revenue has grown by 40.81% in the past year. This is a very strong growth!
The Revenue has been growing by 36.49% on average over the past years. This is a very strong growth!

EPS 1Y (TTM)166.36%

EPS 3Y269.22%

EPS 5Y84.83%

EPS Q2Q%96%

Revenue 1Y (TTM)40.81%

Revenue growth 3Y19.02%

Revenue growth 5Y36.49%

Sales Q2Q%17.26%

3.2 Future

Based on estimates for the next years, APP will show a very strong growth in Earnings Per Share. The EPS will grow by 44.45% on average per year.
The Revenue is expected to grow by 27.22% on average over the next years. This is a very strong growth

EPS Next Y107.83%

EPS Next 2Y80.05%

EPS Next 3Y62.52%

EPS Next 5Y44.45%

Revenue Next Year24.01%

Revenue Next 2Y30.35%

Revenue Next 3Y29.22%

Revenue Next 5Y27.22%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 64.76, the valuation of APP can be described as expensive.
APP's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 28.39. APP is valued rather expensively when compared to this.
The Price/Forward Earnings ratio is 38.68, which means the current valuation is very expensive for APP.
APP's Price/Forward Earnings is on the same level as the industry average.
APP's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.72.

		Industry Rank	Sector Rank
PE	64.76
Fwd PE	38.68

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, APP is valued a bit cheaper than the industry average as 60.43% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of APP is on the same level as its industry peers.

		Industry Rank	Sector Rank
P/FCF	56.61
EV/EBITDA	48.89

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of APP may justify a higher PE ratio.
A more expensive valuation may be justified as APP's earnings are expected to grow with 62.52% in the coming years.