AppLovin Corporation APP has witnessed a remarkable 126.3% surge in its stock year to
date. This extraordinary growth surpasses both the industry’s 21.3% rally and the Zacks S&P 500 composite’s
18.1% increase.
When stacked against competitors in the in-game mobile advertising arena, APP stands out with its robust
performance. While Alphabet Inc. has seen an 18.6% rise, and Meta Platforms has gained 49.2% during the same
period.
Year-to-Date Stock Performance
Image Source: Zacks Investment Research
At the latest trading session, the stock closed at $90.2, near its 52-week high of $92.5. APP is currently
trading above its 50-day moving average, indicating caution among investors.
APP Stock Above Moving Average
Image Source: Zacks Investment Research
Steady Recovery After Correction
Despite the impressive year-to-date surge, APP’s growth has been more subdued in recent months. Over the
last three months, the stock has risen by just 10%, with a 16% gain in the past month alone, reflecting a
recovery post a mid-year correction.
AppLovin’s success can be attributed to its innovative AXON 2.0 technology, studio expansions, and new
strategic initiatives driving market growth. These efforts have translated into robust financial results,
including significant revenue and income surges.
While risks exist, such as potential slowdowns in the in-game advertising sector, AppLovin’s strong
position in the market seems resilient, supported by its tech innovations and strategic expansions.
Promising Outlook for APP
The Zacks Consensus Estimate for APP’s 2024 earnings indicates a substantial 255.1% growth from the
previous year. Earnings in 2025 are forecasted to rise by 20.2%. Sales are projected to increase by 35.1%
in 2024 and by 11.1% in 2025.
Analysts’ Confidence in Uptrend
Recent estimates show increasing confidence among analysts. Six estimates for 2024 have moved upwards in
the past month, with a similar trend for 2025. This trend signifies a strong belief in the company’s
ability to enhance its financial performance.
APP Stock Still Undervalued
Despite the impressive run-up, AppLovin’s shares remain reasonably priced, suggesting further potential
upside. With a Price/Earnings ratio below the industry average and favorable EV-to-EBITDA multiples, APP
presents an attractive investment opportunity.
Image Source: Zacks Investment Research
APP: A Compelling Investment
Given AppLovin’s financial strength, growth potential, and reasonable valuation, APP emerges as a compelling
investment choice. The recent correction in its stock price offers an entry point for investors eyeing
future growth. Backed by innovative tech solutions and strategic moves, AppLovin seems primed for
continued success, making it a must-have for growth-focused investors.
APP currently holds a Zacks Rank #1 (Strong Buy).
