Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside* |
|---|---|---|---|---|---|---|---|
| 12 Mar, 25 | APP | Buy | USD 261.83 | USD 278.0 | USD 294.0 | 5 days | 12.3% |
*Potential Upside (%) indicates the expected percentage increase from the Entry Price to the Target 2 Price.
Data Powered by EOD Historical Data (“EODHD”).
AppLovin Corporation engages in building a software-based platform for advertisers to enhance the marketing and monetization of their content in the United States and internationally. It operates through two segments, Software Platform and Apps. The company's software solutions include AppDiscovery, a marketing software solution, which matches advertiser demand with publisher supply through auctions; MAX, an in-app bidding software that optimizes the value of a publisher's advertising inventory by running a real-time competitive auction; Adjust, a measurement and analytics marketing platform that provides marketers with the visibility, insights, and tools needed to grow their apps from early stage to maturity; and Wurl, a connected TV platform, which distributes streaming video for content companies and provides advertising and publishing solutions through its AdPool, ContentDiscovery, and Global FAST Pass products. It also offers SparkLabs, which uses app store optimization to enhance ad visibility; AppLovin Exchange, which connects buyers to mobile and CTV devices through a single and direct RTB exchange; and Array, an end-to-end app management suite for mobile operators and end users. In addition, the company operates various free-to-play mobile games. It serves individuals, small and independent businesses, enterprises, advertisers and advertising networks, mobile app publishers, indie studio developers, and internet platforms. AppLovin Corporation was incorporated in 2011 and is headquartered in Palo Alto, California.
Strong Advertising Revenue Growth: Advertising revenue increased 73% in Q4 2024 and 75% for the full year compared to 2023. This indicates strong demand and effective monetization strategies
Significant Net Income Growth: Net income surged 248% in Q4 2024 and 343% for the full year, showcasing strong profitability improvements
Share Repurchases Impact on Cash Reserves: The company spent $2.1 billion on share repurchases in 2024, which could limit future cash availability for growth initiatives or acquisitions
Decline in Apps Revenue (Q4 2024): Apps revenue slightly declined by 1% in Q4 2024 compared to Q4 2023, suggesting stagnation or increased competition in this segment
Key investment risks include reliance on advertising revenue growth, potential stagnation in app revenue, high cash outflows for share repurchases, and market competition that could impact future profitability.
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 261.83 | 231.7 | 278.0 | 294.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Technical Commentary: APP's stock has recently found support at significant levels and ended the previous trading day near its highs, suggesting it may be on the verge of an upward reversal, which indicates the potential for near-term gains. The 14-day Relative Strength Index (RSI) is bouncing back from lower levels and is approaching the midpoint. Furthermore, the stock price is below its 50-day Simple Moving Average (SMA), and it may retrace toward these levels in the near term.
As per the above-mentioned technical indicators analysis, a ‘Buy’ rating has been given to Applovin Corporation (NASDAQ: APP) at the current market price of USD 261.83 as of 12 March 2025 at 09:45 AM PST.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Technology Industry: Software - Application
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| APP Applovin Corp |
-33.34 11.48% | 257.05 | 104.12 | 55.25 | 26.80 | 143.62 | 32.10 | 69.70 |
| CRM Salesforce.com Inc |
-13.035 4.80% | 258.50 | 100.89 | 27.47 | 7.42 | 4.34 | 7.44 | 26.81 |
| SAPGF SAP SE |
-4.59 1.69% | 267.00 | 76.28 | 22.88 | 5.61 | 3.84 | 5.59 | 26.18 |
| SAP SAP SE ADR |
-5.98 2.20% | 265.44 | 75.80 | 22.37 | 5.62 | 3.75 | 5.51 | 25.79 |
| INTU Intuit Inc |
-10.215 1.65% | 610.70 | 55.56 | 32.68 | 11.28 | 10.07 | 11.62 | 40.11 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is March 12,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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