AppLovin (NASDAQ:APP) Shares Gap Down – Should You Sell?

AppLovin Co. (NASDAQ:APP)’s share price gapped down before the market opened on Tuesday . The stock had previously closed at $354.93, but opened at $345.68. AppLovin shares last traded at $337.05, with a volume of 721,394 shares.

Wall Street Analyst Weigh In

A number of brokerages recently commented on APP. Needham & Company LLC restated a “hold” rating on shares of AppLovin in a research report on Thursday, November 7th. Jefferies Financial Group raised their price target on AppLovin from $270.00 to $400.00 and gave the company a “buy” rating in a report on Tuesday, November 26th. Daiwa Capital Markets raised AppLovin from a “neutral” rating to an “outperform” rating and upped their price objective for the stock from $80.00 to $280.00 in a report on Friday, November 8th. Macquarie raised their target price on AppLovin from $270.00 to $450.00 and gave the company an “outperform” rating in a report on Friday, December 6th. Finally, Piper Sandler initiated coverage on shares of AppLovin in a research note on Wednesday, November 20th. They set an “overweight” rating and a $400.00 price target on the stock. One equities research analyst has rated the stock with a sell rating, four have issued a hold rating, thirteen have issued a buy rating and one has issued a strong buy rating to the stock. According to MarketBeat.com, AppLovin has an average rating of “Moderate Buy” and a consensus price target of $310.71.

AppLovin Stock Down 9.4 %

The company has a debt-to-equity ratio of 3.70, a current ratio of 2.41 and a quick ratio of 2.41. The firm has a 50-day simple moving average of $305.81 and a two-hundred day simple moving average of $174.20. The company has a market cap of $107.92 billion, a PE ratio of 97.45, a P/E/G ratio of 4.17 and a beta of 2.29.

AppLovin (NASDAQ:APP) last announced its earnings results on Wednesday, November 6th. The company reported $1.25 earnings per share for the quarter, beating the consensus estimate of $0.92 by $0.33. AppLovin had a net margin of 26.85% and a return on equity of 122.24%. The firm had revenue of $1.20 billion during the quarter, compared to the consensus estimate of $1.13 billion. During the same quarter in the previous year, the company posted $0.30 EPS. The firm’s revenue for the quarter was up 38.6% on a year-over-year basis. Research analysts anticipate that AppLovin Co. will post 4.06 earnings per share for the current fiscal year.

Insider Activity at AppLovin

In related news, Director Craig Scott Billings sold 18,000 shares of the firm’s stock in a transaction that occurred on Thursday, November 21st. The shares were sold at an average price of $318.94, for a total value of $5,740,920.00. Following the sale, the director now directly owns 2,987 shares of the company’s stock, valued at approximately $952,673.78. This trade represents a 85.77 % decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Arash Adam Foroughi sold 1,676 shares of the company’s stock in a transaction that occurred on Tuesday, December 10th. The stock was sold at an average price of $356.39, for a total transaction of $597,309.64. Following the transaction, the chief executive officer now directly owns 3,058,635 shares of the company’s stock, valued at $1,090,066,927.65. This trade represents a 0.05 % decrease in their position. The disclosure for this sale can be found here. Over the last 90 days, insiders have sold 888,867 shares of company stock valued at $284,773,062. Company insiders own 14.69% of the company’s stock.

Hedge Funds Weigh In On AppLovin

Hedge funds have recently made changes to their positions in the stock. Capital Performance Advisors LLP purchased a new position in shares of AppLovin in the 3rd quarter worth $25,000. DT Investment Partners LLC purchased a new position in shares of AppLovin in the 3rd quarter worth about $27,000. Meeder Asset Management Inc. acquired a new position in shares of AppLovin in the 3rd quarter valued at about $27,000. Raleigh Capital Management Inc. purchased a new stake in shares of AppLovin during the 3rd quarter worth about $29,000. Finally, Quest Partners LLC acquired a new stake in AppLovin during the 2nd quarter worth approximately $33,000. Institutional investors and hedge funds own 41.85% of the company’s stock.

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.