Another Appian Short Squeeze Is Underway. Is the Stock a Buy?

It's been a wild year for Appian (NASDAQ: APPN). Shares of the low-code software development platform surged higher last year, peaking at a 500% return from the start of 2020 to February 2021. The reason? A short squeeze -- when traders betting against a company close out their position by buying more shares, which can lead to a fast-rising share price.

Appian got clobbered in March and April, though, falling sharply along with other high-flying tech stocks. At one point, it was down some 70% from all-time highs. But short interest has been steadily on the rise again since the start of 2021, from about 7.5% of shares outstanding sold short in January to nearly 12% as of this writing. Appian is a growing business in an increasingly important niche of IT. It looks like another short squeeze could be underway as shares have been rallying higher the last month. Here's why the stock is a buy for those with a much longer outlook.