AppLovin (NASDAQ:APP) Stock Price Down 3.5% - Here's Why

Key Points

• AppLovin's stock price declined by 3.5% during trading, reaching a last trade of $398.28, with a significant drop in trading volume compared to average levels.
• Despite the recent price drop, several analysts have raised their price targets for AppLovin, indicating a generally positive outlook with an average target price of $472.33 and a consensus rating of "Moderate Buy."
• The company reported a Q2 earnings per share of $2.26, surpassing estimates, but its revenue of $1.26 billion fell short of expectations, illustrating mixed financial performance.

AppLovin Corporation (NASDAQ:APP - Get Free Report) was down 3.5% during trading on Wednesday . The stock traded as low as $385.19 and last traded at $398.28. Approximately 2,292,947 shares changed hands during trading, a decline of 68% from the average daily volume of 7,088,942 shares. The stock had previously closed at $412.60.

Analyst Upgrades and Downgrades

Several research analysts have commented on APP shares. BTIG Research lifted their price objective on shares of AppLovin from $480.00 to $483.00 and gave the stock a "buy" rating in a research note on Wednesday, July 23rd. Wall Street Zen lowered shares of AppLovin from a "buy" rating to a "hold" rating in a research note on Saturday, August 9th. Wedbush reissued an "outperform" rating and set a $620.00 target price on shares of AppLovin in a research note on Thursday, August 7th. Piper Sandler boosted their target price on shares of AppLovin from $470.00 to $500.00 and gave the company an "overweight" rating in a research note on Thursday, August 7th. Finally, The Goldman Sachs Group boosted their target price on shares of AppLovin from $335.00 to $435.00 and gave the company a "neutral" rating in a research note on Friday, May 9th. Two analysts have rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating, three have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average target price of $472.86.

AppLovin Price Performance

The company has a debt-to-equity ratio of 3.01, a current ratio of 2.74 and a quick ratio of 2.74. The firm has a fifty day moving average of $375.38 and a two-hundred day moving average of $344.98. The stock has a market capitalization of $149.40 billion, a P/E ratio of 62.74, a P/E/G ratio of 2.47 and a beta of 2.43.

AppLovin (NASDAQ:APP - Get Free Report) last released its quarterly earnings data on Wednesday, August 6th. The company reported $2.26 earnings per share for the quarter, beating the consensus estimate of $2.05 by $0.21. The firm had revenue of $1.26 billion during the quarter, compared to the consensus estimate of $1.37 billion. AppLovin had a return on equity of 252.67% and a net margin of 45.72%.The firm's quarterly revenue was up 77.1% on a year-over-year basis. During the same period in the previous year, the company posted $0.89 earnings per share. On average, analysts predict that AppLovin Corporation will post 6.87 EPS for the current year.

Insider Activity at AppLovin

In related news, CEO Arash Adam Foroughi sold 26,200 shares of AppLovin stock in a transaction dated Friday, August 22nd. The stock was sold at an average price of $440.23, for a total value of $11,534,026.00. Following the completion of the sale, the chief executive officer directly owned 2,590,054 shares in the company, valued at $1,140,219,472.42. The trade was a 1.00% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, insider Victoria Valenzuela sold 16,599 shares of AppLovin stock in a transaction dated Thursday, August 21st. The shares were sold at an average price of $416.71, for a total value of $6,916,969.29. Following the completion of the sale, the insider owned 319,955 shares of the company's stock, valued at $133,328,448.05. The trade was a 4.93% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 1,221,152 shares of company stock worth $538,490,378 over the last three months. 13.66% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On AppLovin

A number of large investors have recently added to or reduced their stakes in the company. Avestar Capital LLC raised its holdings in AppLovin by 2.1% in the second quarter. Avestar Capital LLC now owns 1,117 shares of the company's stock worth $391,000 after purchasing an additional 23 shares in the last quarter. Forum Financial Management LP raised its holdings in AppLovin by 0.9% in the fourth quarter. Forum Financial Management LP now owns 3,776 shares of the company's stock worth $1,223,000 after purchasing an additional 33 shares in the last quarter. Vestcor Inc raised its holdings in AppLovin by 0.8% in the first quarter. Vestcor Inc now owns 4,108 shares of the company's stock worth $1,088,000 after purchasing an additional 33 shares in the last quarter. RWA Wealth Partners LLC raised its holdings in AppLovin by 0.4% in the second quarter. RWA Wealth Partners LLC now owns 7,680 shares of the company's stock worth $2,689,000 after purchasing an additional 33 shares in the last quarter. Finally, Geneos Wealth Management Inc. raised its holdings in AppLovin by 0.8% in the second quarter. Geneos Wealth Management Inc. now owns 4,431 shares of the company's stock worth $1,551,000 after purchasing an additional 33 shares in the last quarter. 41.85% of the stock is currently owned by institutional investors.

About AppLovin

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.