On Tuesday, Oppenheimer maintained a positive stance on shares of AppLovin Corp (NASDAQ:APP), reiterating its Outperform rating and a price target of $480.00. The firm's analyst views the recent 15% decline in AppLovin's stock price as an attractive entry point for investors. The drop on Monday was notably steeper than the broader market, with the S&P 500 experiencing a modest 0.6% decrease.
The analyst believes that AppLovin, which experienced the sell-off on Monday, offers a compelling investment opportunity, describing the company as one of the most promising growth entities currently available at a reasonable price.
Supporting this view, InvestingPro analysis reveals that AppLovin operates with moderate debt levels and maintains liquid assets exceeding short-term obligations. The analysis includes a deeper look into the company's long-term growth drivers, focusing on its burgeoning e-commerce sector and the potential of its non-gaming business, with analysts anticipating continued sales growth this year.
AppLovin's recent customer feedback from its e-commerce pilot program conducted around Black Friday and Cyber Monday was also highlighted. The latest data, which has been incorporated into Oppenheimer's comprehensive analysis, continues to show highly favorable responses from customers engaging with AppLovin's platform.
The analyst emphasized the near-term catalysts expected to propel the company's performance in early 2025. With these factors in mind, AppLovin remains one of the top picks within Oppenheimer's coverage universe, suggesting strong confidence in the company's future trajectory.
In other recent news, AppLovin Corp has made significant financial maneuvers, including issuing $3.55 billion in senior notes and securing a new $1 billion unsecured revolving credit facility with JPMorgan Chase (NYSE:JPM). These moves come amidst a 41.5% revenue growth over the past year and are part of a strategy to repay existing senior secured term loan facilities due in 2028 and 2030.
Several financial firms have maintained positive ratings and increased price targets for AppLovin. Stifel has raised its price target to $435, maintaining a "Buy" rating. Piper Sandler has kept an "Overweight" rating with a price target of $400, while Loop Capital has retained its "Buy" rating with a price target of $385. Oppenheimer has significantly increased its price target to $480, maintaining an "Outperform" rating.
AppLovin's third-quarter results showcased a 39% year-over-year increase in revenue, reaching $1.2 billion. The company is transitioning to an all unsecured debt capital structure following investment grade ratings from S&P Global Ratings and Fitch Ratings.
Projections for Q4 2024 revenue are between $1.24 billion and $1.26 billion, with adjusted EBITDA expectations of $740 million to $760 million. These are among the recent developments within AppLovin.
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