The Appen Ltd (ASX: APX) share price is charging higher again on Thursday.
In late morning trade, the artificial intelligence data services company’s shares are up almost 3% to $11.65.
This means Appen’s shares are now up 30% since this time last month.
Can the Appen share price keep rising?
The good news is that one leading broker believes the Appen share price can keep rising from here. In fact, it has a price target well beyond where the company’s shares are trading today.
According to a note out of Citi from last week, its analysts have a buy rating and $17.10 price target on the company’s shares.
Based on the current Appen share price, this implies potential upside of 47% over the next 12 months. Not bad considering its recent gains!
Why is the broker bullish?
Citi has been bullish on Appen for a while, believing that it is well-placed to benefit from increasing demand for high quality data for artificial intelligence and machine learning models.
These models require huge quantities of high quality data in order to make their models successful. And that data needs to be prepared before being used. So, with a million-strong team of experts across the globe, Appen is able to provide tech giants such as Facebook and Google with the data they require.
Recently, however, COVID-19 led to many tech giants holding back on their artificial intelligence investment. This put a dampener on Appen’s growth and significant pressure on the Appen share price.
But at long last, the tide appears to be turning. Citi’s note highlights that Facebook has recently revealed that it intends to lift its artificial intelligence investment materially in FY 2022. The broker feels this bodes well for Appen and could lead to an increase in demand for its services.
All in all, while the Appen share price has rallied hard in recent weeks, this broker doesn’t appear to believe it is too late to get on board.