The Appen Ltd (ASX: APX) share price has come under pressure on Tuesday.
In morning trade, the artificial intelligence data services company’s shares were down 5% to $12.26.
When the Appen share price hit that level, it meant it was down by over 51% since the start of the year.
Why is the Appen share price under pressure?
Investors have been selling down the Appen share price today despite there being no news out of the company or broker notes that I’m aware of.
However, something that could be weighing on its shares was a recent ceasing to be a substantial holder notice.
According to the notice from Monday, the Capital Group Companies has been selling a large number of shares on-market in recent weeks and as recently as 1 July. On that particular day, the fund manager sold 583,170 shares for just a touch over $8 million.
This may have investors concerned as it was only just over a month ago when the fund manager, which has over US$2 trillion in assets under management, was loading up on Appen shares. It appears as though Capital Group Companies has changed its mind about Appen pretty quickly. However, it isn’t immediately apparent why at this stage.
Is this a buying opportunity?
The current Appen share price could have a lot of potential upside based on some recent broker notes.
According to a note out of Ord Minnett in late May, its analysts have a buy rating and $24.75 price target on its shares. This implies over 100% upside over the next 12 months if its analysts are on the money.
Even analysts at Credit Suisse, which have just a neutral rating on its shares, see decent upside from here. Their $15.00 price target offers potential upside of ~22% over the next 12 months.