APP AppLovin Corporation - Fundamental Analysis
BULLISH
APP Stock | Fundamental Analysis & Investment Insights
NASDAQ
•
Communication Services
•
Advertising Agencies
Current Price
$557.7
Analyst Target
$718.71
+28.9% Upside
52W High
$745.61
52W Low
$200.5
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
88%
Analysis Accuracy
AppLovin Corporation (APP) exhibits exceptional growth and profitability metrics, with 68.2% YoY revenue growth and 76.8% operating margin, significantly outpacing its Communication Services peers. Despite a rich valuation—P/E of 65.77 and forward P/E of 108.08—the stock is supported by strong earnings momentum, consistent analyst buy ratings, and a $718.71 average target price implying ~29% upside. The company’s 3-year return of +3493.4% reflects dominant market execution, though recent insider selling and short-term price weakness (-10% over 1W) suggest profit-taking pressure. Relative to peers like AT&T and Verizon trading below 9x P/E, APP commands a premium justified by hypergrowth and superior ROE of 241.89%.
Key Strengths
Exceptional profitability with 76.80% operating margin, far above sector average of 17.44%
Explosive revenue growth at 68.20% YoY, dwarfing peer average of 5.77%
Outstanding return on equity (ROE) of 241.89%, more than 10x the sector average
Consistent earnings beat streak: 3 out of last 4 quarters beat estimates, with 10.05% average surprise
Analyst consensus strongly supportive with 24 analysts rating 'buy' and $718.71 target implying significant upside
Key Risks
Extremely high forward P/E of 108.08 raises sustainability concerns if growth slows even slightly
Debt/Equity ratio of 2.38 is above sector average of 1.86, increasing financial risk in rising rate environment
Recent insider selling of $153.08M over 6 months signals potential lack of confidence from executives
Valuation multiples (Price/Sales: 29.80, Price/Book: 128.09) are extreme relative to peers and historical norms
Missing earnings estimates in 2023-2024 (e.g., -52.8% surprise in May 2023) shows volatility in execution
AI Fair Value Estimate
Based on comprehensive analysis
$718.71
+28.9% above current price
Performance Snowflake
Multi-dimensional AI analysis across 5 key categories
Stock Price & Analyst Targets
Real-time price movements and analyst price targets
Historical Performance Trends
Long-term financial metrics and growth patterns
Valuation Metrics
Key valuation ratios and pricing indicators
Profitability, Growth & Financial Health
Detailed profit margins, ROE, debt ratios, and liquidity metrics
Sector Comparison & Peer Analysis
Compare APP against industry averages and similar companies
Insider Trading & Analyst Ratings
Track insider transactions and Wall Street analyst recommendations