Trade Alert: Bought AppLovin (APP) $88. 14-16% ROI expected for the next two-three years.
Ad-tech fast grower with a strong platform; It’s having an outstanding year, but still has a long runway of growth left.
AppLovin’s key strengths are in mobile advertising, especially in gaming, where it matches customers with developers/advertisers.
It’s moved out beyond gaming working with customers like Experian and is also now working with connected TV/streaming.
Growth – 50% in earnings, 17% in revenues, cash flow and operating margins are over 30%. These look good for the next two-three years.
AppLovin’s critical advantage is data for their AI platform, which they collect from their massive gaming audience. The big risk, we don’t know well they’ll perform outside of gaming or in video streaming, where at least for now they don’t have data.