What is Happening to the Share Price of Appen Ltd?

What does Appen Ltd do?

Appen Ltd [ASX:APX] is a global provider of language and search data services. They assist technology companies and governments to improve the way they deal with languages, improving search accuracy and delivering the best content and news to users.

Appen can do this because they have a global network of local experts who have the language and cultural knowledge needed to best interpret queries from users in their region, allowing for the most efficient analysis.

They also provide services in speech recognition, such as supporting Skype’s translator, supporting vehicle makers with hands free voice activated driving commands, and in the gaming industry with voice activated commands enhancing player experience.

Half year results

The company announced half year results recently on August 28. This company listed at the start of the year, so there is no full financial year result.

Results were positive, with revenues up by 33%, driven mainly by the company’s content relevance division assisting customers with language resources in web search and ecommerce.

That’s interesting, but what is the chart telling you?

What is the chart telling you?

I personally find it helpful to bring up a chart. Here’s the daily chart of APX:

Appen chart

Source: STEX

The share price has pretty much gone sideways since listing. This is in contrast to the general market, which has been sold down over the last four months. The chart is suggesting that the business model is satisfactory at the moment.

The gap up was on news of the positive half year result. That news now gives you a reference point you can use in your future analysis.

What now for APX shares?

You could do your own analysis, watch and follow this stock and just see if that gap fills or not. That will give you feedback on how the company is progressing over the short term. You could also look at the company announcements and see what they are telling you about the company.

The shares in this company trade thinly. Apply the appropriate risk management to that, if you decide to invest in such stocks like this. In other words, don’t load up too much on thinly traded stocks, as they can gap down very quickly and you may not actually be able to get out at the price you want. Just common sense really.

Start to read the charts to guide your investment decisions. The chart will tell you in advance what to expect for this company, if you can read it properly. Go here to find out more.

Terence Duffy,
Research Analyst, Cycles, Trends and Forecasts

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Terence Duffy is an analyst and chartist, specialising in researching economic trends and cycles.  His primary focus is housing and land affordability. But you can also depend on him to offer his unique analysis of stock market charts. As Terence will show you, the charts often forecast, well in advance, the good or bad news to come — which he details in Cycles, Trends and Forecasts.

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