AppLovin (APP) stock has been rather volatile in recent sessions after the Securities and Exchange Commission (SEC) announced an investigation into the California-based ad-tech company.
The probe centers on allegations that AppLovin violated service agreements with platform partners regarding data collection practices, specially examining whether the company improperly collected user identification data from major platforms like Meta, Snap, TikTok, Reddit, and Google.
Following an initial SEC-driven decline, AppLovin shares recovered significantly on Tuesday and are currently up some 215% versus their year-to-date low in early April.
Investors should consider buying the dip in APP stock today mostly because the firm’s fundamental business performance remains remarkably strong.
AppLovin’s transformation from a mobile gaming app company into an artificial intelligence (AI) enabled ad-tech leader has been particularly successful, with its AXON 2.0 optimization engine serving as a major growth catalyst.
Financial metrics support this success story, with the company maintaining robust fundamentals including a 33.35% profit margin and annual revenue of $4.7 billion.
Its latest quarterly results demonstrate continued momentum with revenue increasing 77% year-over-year to $1.26 billion and net income soaring 164% to $820 million, further strengthening the case for owning AppLovin stock.
AppLovin’s expansion beyond mobile gaming into e-commerce advertising represents a significant growth opportunity, with the potential market estimated to be 20 times larger than its current focus.
Another major reason to stick with APP shares for the longer term is its recent addition to the S&P 500 Index ($SPX) which further validates the firm’s market position and could drive institutional capital to it.
In a recent interview with CNBC, Needham analyst Bernie McTernan also cited these tailwinds to assert that AppLovin stock is “rightfully” trading at a premium.
McTernan is bullish on the company’s latest launch of its self-service platform and believes APP stock will follow a similar trajectory as TikTok that “went from a billion to two billion to five billion to nine billion.”
AppLovin (APP) stock has been rather volatile in recent sessions after the Securities and Exchange Commission (SEC) announced an investigation into the California-based ad-tech company.
The probe centers on allegations that AppLovin violated service agreements with platform partners regarding data collection practices, specially examining whether the company improperly collected user identification data from major platforms like Meta, Snap, TikTok, Reddit, and Google.
Following an initial SEC-driven decline, AppLovin shares recovered significantly on Tuesday and are currently up some 215% versus their year-to-date low in early April.
Investors should consider buying the dip in APP stock today mostly because the firm’s fundamental business performance remains remarkably strong.
AppLovin’s transformation from a mobile gaming app company into an artificial intelligence (AI) enabled ad-tech leader has been particularly successful, with its AXON 2.0 optimization engine serving as a major growth catalyst.
Financial metrics support this success story, with the company maintaining robust fundamentals including a 33.35% profit margin and annual revenue of $4.7 billion.
Its latest quarterly results demonstrate continued momentum with revenue increasing 77% year-over-year to $1.26 billion and net income soaring 164% to $820 million, further strengthening the case for owning AppLovin stock.
AppLovin’s expansion beyond mobile gaming into e-commerce advertising represents a significant growth opportunity, with the potential market estimated to be 20 times larger than its current focus.
Another major reason to stick with APP shares for the longer term is its recent addition to the S&P 500 Index ($SPX) which further validates the firm’s market position and could drive institutional capital to it.
In a recent interview with CNBC, Needham analyst Bernie McTernan also cited these tailwinds to assert that AppLovin stock is “rightfully” trading at a premium.
McTernan is bullish on the company’s latest launch of its self-service platform and believes APP stock will follow a similar trajectory as TikTok that “went from a billion to two billion to five billion to nine billion.”
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