Why AppLovin (APP) Is Up 6.8% After S&P Index Adds and Axon Ads Expansion

• AppLovin Corporation was added to the S&P 500 Equal Weighted Index on September 20 and the S&P Global 1200 Index on September 22, following the company's announcement of the Axon Ads Manager platform launch and its expansion into non-gaming advertisers.
• This marks a pivotal step for AppLovin as it broadens its addressable market beyond gaming, spotlighting the company's evolution into a global advertising technology provider.
• We’ll explore how AppLovin’s new Axon Ads Manager for non-gaming advertisers could accelerate its growth narrative and long-term outlook.

Find companies with promising cash flow potential yet trading below their fair value.

AppLovin Investment Narrative Recap

At its core, the case for owning AppLovin centers on whether the company can successfully diversify beyond mobile gaming and become a global leader in AI-driven advertising technology. The addition to major indices in September spotlights institutional validation, yet the effectiveness and adoption speed of its Axon Ads Manager platform remain the most critical near-term catalyst, while intensifying competition and platform dependence are ongoing risks. These index moves, while supportive, do not substantially change those key drivers or risks in the short term.

The rollout of AppLovin’s Axon Ads Manager for non-gaming advertisers, set for soft launch in October, is the most relevant recent development. This new self-serve platform aims to expand AppLovin’s advertiser base beyond the gaming sector, which could help address concentration risk and drive the next phase of growth that many investors are watching closely.

However, investors should also keep in mind that, despite the excitement, the company's reliance on third-party mobile platforms still means...

Read the full narrative on AppLovin (it's free!)

AppLovin's narrative projects $10.5 billion revenue and $6.2 billion earnings by 2028. This requires 22.2% yearly revenue growth and a $3.7 billion earnings increase from $2.5 billion today.

Uncover how AppLovin's forecasts yield a $613.59 fair value, a 10% downside to its current price.

Exploring Other Perspectives

Private fair value estimates from 24 Simply Wall St Community members range from US$318 to US$650 per share. While the catalyst of a broader advertiser base could unlock new growth, your own outlook may vary widely, take time to examine other community views.

Explore 24 other fair value estimates on AppLovin - why the stock might be worth less than half the current price!

Build Your Own AppLovin Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your AppLovin research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free AppLovin research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate AppLovin's overall financial health at a glance.

No Opportunity In AppLovin?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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