AppLovin (NASDAQ:APP) Stock Price Down 8.7% - What's Next?

Key Points

• AppLovin shares fell 8.7% on Monday, trading as low as $471.32 amid sharply lighter volume than usual, after closing at $506.98 the prior session.
• Despite the drop, Wall Street sentiment remains constructive: analysts’ consensus rating is “Moderate Buy,” with an average price target of $668.45, and several firms recently reiterated or raised targets.
• The company’s latest earnings were better than expected, with EPS of $3.56 and revenue of $1.84 billion, while insider selling continued and hedge funds held a large stake in the stock.

AppLovin Corporation (NASDAQ:APP - Get Free Report) dropped 8.7% during trading on Monday . The stock traded as low as $471.32 and last traded at $462.8580. 547,202 shares were traded during trading, a decline of 90% from the average session volume of 5,457,605 shares. The stock had previously closed at $506.98.

Analysts Set New Price Targets

A number of brokerages have weighed in on APP. Wells Fargo & Company increased their target price on shares of AppLovin from $571.00 to $575.00 and gave the stock an "overweight" rating in a research report on Tuesday, July 7th. JPMorgan Chase & Co. boosted their price target on shares of AppLovin from $500.00 to $515.00 and gave the company a "neutral" rating in a research report on Thursday, May 7th. Weiss Ratings upgraded shares of AppLovin from a "hold (c)" rating to a "hold (c+)" rating in a research note on Wednesday. Citigroup reaffirmed a "buy" rating on shares of AppLovin in a report on Monday, June 22nd. Finally, Needham & Company LLC reiterated a "buy" rating and issued a $700.00 price objective on shares of AppLovin in a research note on Thursday, May 28th. Two research analysts have rated the stock with a Strong Buy rating, seventeen have assigned a Buy rating and five have assigned a Hold rating to the company's stock. According to MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus price target of $668.45.

AppLovin Stock Down 11.0%

The stock has a fifty day simple moving average of $509.16 and a two-hundred day simple moving average of $497.50. The firm has a market cap of $151.53 billion, a PE ratio of 38.83, a price-to-earnings-growth ratio of 0.82 and a beta of 2.49. The company has a current ratio of 3.24, a quick ratio of 3.24 and a debt-to-equity ratio of 1.49.

AppLovin (NASDAQ:APP - Get Free Report) last announced its quarterly earnings results on Wednesday, May 6th. The company reported $3.56 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $3.44 by $0.12. The firm had revenue of $1.84 billion for the quarter, compared to the consensus estimate of $1.77 billion. AppLovin had a net margin of 64.29% and a return on equity of 219.37%. The company's revenue for the quarter was up 58.9% on a year-over-year basis. During the same period in the prior year, the firm posted $1.67 earnings per share. As a group, sell-side analysts expect that AppLovin Corporation will post 15.93 EPS for the current fiscal year.

Insiders Place Their Bets

In other news, insider Victoria Valenzuela sold 20,000 shares of the company's stock in a transaction on Thursday, June 4th. The shares were sold at an average price of $565.89, for a total value of $11,317,800.00. Following the transaction, the insider owned 243,961 shares of the company's stock, valued at approximately $138,055,090.29. This represents a 7.58% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, Director Maynard G. Webb, Jr. sold 3,076 shares of the company's stock in a transaction on Monday, July 6th. The stock was sold at an average price of $521.29, for a total transaction of $1,603,488.04. Following the completion of the transaction, the director directly owned 120,444 shares in the company, valued at approximately $62,786,252.76. The trade was a 2.49% decrease in their position. The SEC filing for this sale provides additional information. Over the last ninety days, insiders sold 393,000 shares of company stock worth $197,297,363. Company insiders own 13.66% of the company's stock.

Hedge Funds Weigh In On AppLovin

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. State Street Corp raised its holdings in shares of AppLovin by 111.1% during the 3rd quarter. State Street Corp now owns 11,852,466 shares of the company's stock valued at $8,516,471,000 after buying an additional 6,237,051 shares in the last quarter. Corient Private Wealth LLC boosted its stake in AppLovin by 3,118.6% in the fourth quarter. Corient Private Wealth LLC now owns 4,194,071 shares of the company's stock worth $2,826,049,000 after buying an additional 4,063,763 shares in the last quarter. Norges Bank purchased a new stake in AppLovin in the fourth quarter worth approximately $2,040,321,000. Northern Trust Corp grew its position in AppLovin by 46.8% during the third quarter. Northern Trust Corp now owns 2,374,460 shares of the company's stock valued at $1,706,144,000 after acquiring an additional 756,660 shares during the last quarter. Finally, Amundi raised its stake in shares of AppLovin by 81.3% during the fourth quarter. Amundi now owns 1,426,896 shares of the company's stock worth $961,471,000 after acquiring an additional 639,836 shares in the last quarter. 41.85% of the stock is currently owned by hedge funds and other institutional investors.

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.

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