AppLovin (NASDAQ:APP) Shares Gap Down After Analyst Downgrade

AppLovin Corporation (NASDAQ:APP)’s stock price gapped down before the market opened on Thursday after Wells Fargo & Company lowered their price target on the stock from $735.00 to $543.00. The stock had previously closed at $456.81, but opened at $404.00. Wells Fargo & Company currently has an overweight rating on the stock. AppLovin shares last traded at $383.1830, with a volume of 5,688,573 shares changing hands.

Several other equities research analysts also recently weighed in on APP. Scotiabank increased their target price on shares of AppLovin from $575.00 to $750.00 and gave the company an “outperform” rating in a research note on Thursday, November 6th. Evercore reiterated a “buy” rating on shares of AppLovin in a report on Friday, January 30th. Royal Bank Of Canada increased their price objective on shares of AppLovin from $700.00 to $750.00 and gave the stock an “outperform” rating in a research report on Thursday, November 6th. Citigroup dropped their target price on AppLovin from $850.00 to $820.00 and set a “buy” rating for the company in a research report on Wednesday, November 12th. Finally, Deutsche Bank Aktiengesellschaft set a $705.00 price target on AppLovin and gave the stock a “buy” rating in a report on Wednesday, October 22nd. One analyst has rated the stock with a Strong Buy rating, twenty have given a Buy rating, three have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $664.73.

Insider Buying and Selling at AppLovin

In related news, insider Victoria Valenzuela sold 7,609 shares of the company’s stock in a transaction on Thursday, December 18th. The stock was sold at an average price of $657.13, for a total transaction of $5,000,102.17. Following the completion of the sale, the insider directly owned 277,110 shares in the company, valued at $182,097,294.30. This represents a 2.67% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this link. Also, CEO Arash Adam Foroughi sold 4,069 shares of AppLovin stock in a transaction that occurred on Friday, November 21st. The stock was sold at an average price of $497.50, for a total transaction of $2,024,327.50. Following the completion of the transaction, the chief executive officer directly owned 2,998,948 shares in the company, valued at approximately $1,491,976,630. The trade was a 0.14% decrease in their position. The SEC filing for this sale provides additional information. In the last 90 days, insiders have sold 187,786 shares of company stock worth $100,914,925. 13.66% of the stock is owned by company insiders.

Key Stories Impacting AppLovin

Here are the key news stories impacting AppLovin this week:

• Positive Sentiment: Q4 earnings beat — AppLovin reported $3.24 EPS vs. $2.89 expected and revenue of $1.66B (up 66% YoY), showing strong profitability and margin expansion. BusinessWire: Q4 Results
• Positive Sentiment: Q1 guidance tops street — AppLovin issued revenue guidance of about $1.7B–$1.8B for Q1, above the ~ $1.6B consensus, which is constructive for near-term top-line visibility. Earnings Release / Guidance
• Positive Sentiment: Analyst backing remains — Needham reaffirmed a “buy” rating with a $700 target, signaling continued analyst confidence in AppLovin’s long-term growth thesis. Benzinga: Needham Rating
• Neutral Sentiment: Mixed analyst positioning — BTIG trimmed its price target from $771 to $640 but kept a buy rating; that narrows upside expectations even as the stock remains a buy for some firms. The Fly: BTIG PT Cut
• Neutral Sentiment: Management tone — CEO downplayed AI-related risks on the call, an attempt to reassure investors about the company’s strategic positioning in AI-driven ad products. MSN: CEO Comments
• Negative Sentiment: Market reaction: sell-the-news / demand worries — Despite beats, several outlets and traders flagged softer-than-expected advertising demand, heightened competition and questions about sustainable growth; that commentary drove a post-earnings pullback. Reuters: Revenue / Competition Concerns
• Negative Sentiment: Coverage and sentiment noise — Multiple headlines (Investopedia, MarketWatch, Seeking Alpha) emphasise the stock slide and investor disappointment post-earnings, which can amplify volatility and short-term selling pressure. Investopedia: Market Headlines

Hedge Funds Weigh In On AppLovin

A number of large investors have recently made changes to their positions in APP. Concurrent Investment Advisors LLC boosted its stake in AppLovin by 31.5% in the 2nd quarter. Concurrent Investment Advisors LLC now owns 4,646 shares of the company’s stock worth $1,627,000 after purchasing an additional 1,114 shares in the last quarter. Lazard Freres Gestion S.A.S. purchased a new position in shares of AppLovin in the third quarter worth $2,514,000. Mediolanum International Funds Ltd raised its holdings in shares of AppLovin by 73.5% in the third quarter. Mediolanum International Funds Ltd now owns 76,736 shares of the company’s stock worth $54,664,000 after buying an additional 32,510 shares during the last quarter. Thames Capital Management LLC lifted its stake in shares of AppLovin by 114.8% during the third quarter. Thames Capital Management LLC now owns 16,702 shares of the company’s stock worth $12,001,000 after buying an additional 8,925 shares during the period. Finally, CIBC Asset Management Inc grew its holdings in shares of AppLovin by 14.8% during the third quarter. CIBC Asset Management Inc now owns 117,126 shares of the company’s stock valued at $84,160,000 after buying an additional 15,074 shares during the last quarter. 41.85% of the stock is owned by institutional investors and hedge funds.

AppLovin Stock Performance

The stock has a market capitalization of $128.51 billion, a price-to-earnings ratio of 46.50, a P/E/G ratio of 1.56 and a beta of 2.49. The company has a current ratio of 3.25, a quick ratio of 3.25 and a debt-to-equity ratio of 2.38. The firm has a 50-day moving average of $608.86 and a 200-day moving average of $571.60.

AppLovin (NASDAQ:APP) last released its quarterly earnings data on Wednesday, February 11th. The company reported $3.24 EPS for the quarter, beating the consensus estimate of $2.89 by $0.35. The business had revenue of $1.66 billion for the quarter, compared to the consensus estimate of $1.61 billion. AppLovin had a net margin of 51.27% and a return on equity of 258.49%. The business’s revenue for the quarter was up 66.0% on a year-over-year basis. During the same period in the prior year, the firm earned $1.73 EPS. As a group, sell-side analysts predict that AppLovin Corporation will post 6.87 earnings per share for the current year.

About AppLovin

AppLovin Corporation is a Palo Alto–based mobile technology company that provides software and services to help app developers grow and monetize their businesses. The company operates a data-driven advertising and marketing platform that connects app publishers and advertisers, delivering tools for user acquisition, monetization, analytics and creative optimization. AppLovin’s technology is integrated into a broad set of mobile applications through software development kits (SDKs) and ad products designed to maximize revenue and engagement for developers.

Key components of AppLovin’s offering include an ad mediation and exchange platform that enables publishers to manage and monetize inventory across multiple demand sources, and a user-acquisition platform that helps advertisers target and scale campaigns.