This month we add Appen (APX) to Conviction Insights, a global leader in the collection, labelling and analysis of data used to build and continuously improve some of the world’s most innovative artificial intelligence and search systems.
Our inclusion of Appen in Conviction Insights and our overweight recommendation is predicated on a number of factors:
- A strong and growing track record of performance and profit growth
- High quality customers, albeit very concentrated (>85% of FY19 revenue)
- Appen is one of two leading global players with a material gap to the 3rd biggest player
- Strong secular trends with AI-related revenues to grow at a ~40% CAGR and 3rd Party Data Labelling revenues to grow at a ~55% CAGR over the coming ~5 years
- A dynamic growth strategy to supplement Appen’s robust, core organic growth with strategic acquisitions
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Written by
James Ferrier, Head of Research
James is Head of Research and has more than 13 years’ experience as a senior analyst with Wilsons Advisory.