The Appen Ltd (ASX: APX) share price has been a strong performer on Thursday.
In afternoon trade, the artificial intelligence (AI) data services company’s shares are up 6% to $9.31.
However, despite this strong gain, Appen’s shares are still down a disappointing 63% since the start of the year.
Could the Appen share price rebound to $17.00 by Christmas?
Positively for shareholders, one leading broker believes the Appen share price could rise materially from here.
According to a note out of Citi this week, its analysts have retained their buy rating and $17.00 price target on the company’s shares. Based on the current Appen share price, this implies massive upside of 82% for investors.
In light of this, Citi appears to see potential for the Appen share price to trade at that level at Christmas. Though, it is worth noting that this price target is for the next 12 months.
Why is Citi bullish?
While the broker acknowledges that trading conditions have been tough recently, which explains why Appen’s shares are performing so poorly this year, it remains positive on the long term.
Citi sees Appen as well placed to benefit from the higher spending on artificial intelligence and expects it to leverage its increased capabilities and expand its addressable market.
The broker has also previously noted that its industry discussions suggest that demand for human annotated training data is not structurally impaired.
It also previously suggested that the company could become a takeover target if its shares stay this low for much longer. The broker highlights that rival Lionbridge was acquired by Telus on much higher multiples to those that the Appen share price currently trades on.
