‘The Fastest Growth Still Lies Ahead,’ Says Jefferies About AppLovin Stock (APP)

AppLovin (APP) has captured attention on Wall Street with its impressive Q1 earnings, driving its stock up nearly 12%. Notably, Jefferies remains optimistic about the company’s growth trajectory, stating that “the fastest growth still lies ahead.” This positive outlook comes after AppLovin’s earnings beat and the announcement of the sale of its mobile gaming business to Tripledot Studios, signaling a strategic shift for the company.

Jefferies Raises Price Target on APP Stock

Following the results, four-star-rated analyst James Heaney CFA lifted his price target on APP stock from $460 to $530 and kept his Buy rating. Jefferies estimates that AppLovin currently serves less than 1,000 web-based advertisers, representing just 0.1% of its total addressable market, indicating substantial growth potential.

Additionally, AppLovin’s small presence in China and its early growth stage give it an advantage over bigger competitors.

Other Analysts Weigh In on APP Stock

Similarly, UBS analysts raised their price target on AppLovin stock from $450 to $475 and maintained a positive outlook. However, they cautioned that recent short-seller reports might dampen investor confidence and slightly impact the willingness of web-based advertisers to try AppLovin’s platform.

In March, Muddy Waters Research became the third short seller in as many months to issue a scathing report on AppLovin, raising serious concerns about the company’s business practices and leadership.

Meanwhile, Wedbush upheld its more optimistic target of $620 for AppLovin stock, praising the company’s advertising business, which it described as “continues to amaze.” Notably, the company’s advertising revenue grew by solid 71% year-over-year in the first quarter.

Is AppLovin a Good Stock to Buy?

According to TipRanks, APP stock has received a Moderate Buy consensus rating based on 15 Buys, three Holds, and one Sell assigned in the last three months. The average AppLovin stock price target is $473.06, suggesting an upside of 40% from its current price.

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