AppLovin Stock To $945?
AppLovin (APP) stock has jumped 11% during the past week, and is currently trading at $727.50. Our multi-factor assessment suggests that it may be time to buy more shares of APP stock. We have, overall, a positive view of the stock, and a price of $945 may not be out of reach. We believe there is not much to fear in APP stock given its overall Very Strong operating performance and financial condition. Hence, despite its Very High valuation, the stock appears Attractive but Volatile.
Below is our assessment:
| CONCLUSION | |
|---|---|
| What you pay: | |
| Valuation | Very High |
| What you get: | |
| Growth | Very Strong |
| Profitability | Very Strong |
| Financial Stability | Very Strong |
| Downturn Resilience | Very Weak |
| Operating Performance | Very Strong |
| Stock Opinion | Attractive but Volatile |
Individual stocks can be volatile, but markets aren’t spared either – 2008, 2020. Volatility happens. See how Trefis’ Boston-based, wealth management partner’s asset allocation framework handled both.
Let’s get into details of each of the assessed factors but before that, for quick background: With $246 Bil in market cap, AppLovin provides a software platform for mobile app developers to enhance app marketing and monetization, featuring AppDiscovery, a marketing solution that matches advertiser demand with publisher supply through auctions.
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[1] Valuation Looks Very High
| APP | S&P 500 | |
|---|---|---|
| Price-to-Sales Ratio | 37.1 | 3.2 |
| Price-to-Earnings Ratio | 86.9 | 23.5 |
| Price-to-Free Cash Flow Ratio | 73.3 | 20.6 |
This table highlights how APP is valued vs broader market. For more details see: APP Valuation Ratios
[2] Growth Is Very Strong
- AppLovin has seen its top line grow at an average rate of 36.0% over the last 3 years
- Its revenues have grown 86% from $3.6 Bil to $6.6 Bil in the last 12 months
- Also, its quarterly revenues grew 68.2% to $1.4 Bil in the most recent quarter from $835 Mil a year ago.
| APP | S&P 500 | |
|---|---|---|
| 3-Year Average | 36.0% | 5.5% |
| Latest Twelve Months* | 86.4% | 6.1% |
| Most Recent Quarter (YoY)* | 68.2% | 7.3% |
This table highlights how APP is growing vs broader market. For more details see: APP Revenue Comparison
[3] Profitability Appears Very Strong
- APP last 12 month operating income was $3.5 Bil representing operating margin of 52.5%
- With cash flow margin of 50.6%, it generated nearly $3.4 Bil in operating cash flow over this period
- For the same period, APP generated nearly $2.8 Bil in net income, suggesting net margin of about 42.7%
| APP | S&P 500 | |
|---|---|---|
| Current Operating Margin | 52.5% | 18.8% |
| Current OCF Margin | 50.6% | 20.4% |
| Current Net Income Margin | 42.7% | 13.1% |
This table highlights how APP profitability vs broader market. For more details see: APP Operating Income Comparison
[4] Financial Stability Looks Very Strong
- APP Debt was $3.5 Bil at the end of the most recent quarter, while its current Market Cap is $246 Bil. This implies Debt-to-Equity Ratio of 1.4%
- APP Cash (including cash equivalents) makes up $1.7 Bil of $6.3 Bil in total Assets. This yields a Cash-to-Assets Ratio of 26.3%
| APP | S&P 500 | |
|---|---|---|
| Current Debt-to-Equity Ratio | 1.4% | 20.8% |
| Current Cash-to-Assets Ratio | 26.3% | 7.1% |
[5] Downturn Resilience Is Very Weak
APP has fared much worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
2022 Inflation Shock
- APP stock fell 91.9% from a high of $114.85 on 11 November 2021 to $9.30 on 27 December 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 16 September 2024
- Since then, the stock increased to a high of $733.60 on 22 December 2025 , and currently trades at $727.50
| APP | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -91.9% | -25.4% |
| Time to Full Recovery | 629 days | 464 days |
But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read APP Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.