AppLovin: Astounding Growth And Profitability, Yet Demonstrably Out Of Favor

Michael Wiggins De OliveiraInvesting Group LeaderFollow5ShareSavePlay(8min)Comments(4)SummaryAppLovin Corporation is upgraded to Buy with a $750 price target by summer 2026, driven by exceptional free cash flow and robust revenue growth.APP is growing revenue at 45%+ y/y, with Q4 free cash flow up 88% y/y to $1.3B, and 2026 FCF estimates now at $5.8B.Trading at 26x forward free cash flow and a 0.6x adjusted PEG, APP's valuation is seen as highly attractive given its growth profile.Key APP risks include potential deceleration in growth and unproven e-commerce expansion, but no current evidence of AI or competitive disruption.Looking for a helping hand in the market? Members of Deep Value Returns get exclusive ideas and guidance to navigate any climate. Learn More » J Studios/DigitalVision via Getty Images Dear Readers Here's my previous article on AppLovin Corporation (APP). You will now see that since July, this business is now much stronger, even as its valuation is clearly more compelling. Any rational, dispassionate appraiser would agree withThis article was written byMichael Wiggins De Oliveira52.52K FollowersFollowMichael Wiggins De Oliveira is an Inflection investor. As an Inflection investor, I believe that simplicity is key to outperformance. Since 2024, Deep Value Returns is up 174% vs 58% for the Nasdaq (*as of 6 January 2026).This means buying a stock at the moment when the outlook is expected to improve over the next year. This allows one to minimize the downside, while positioning yourself at the moment when the stock is primed to perform strongly.With a focus on tech and “the Great Energy Transition (including uranium)”, Michael runs a concentrated portfolio with approximately 15 to 20 stocks and an average holding period of 18 months. Through his 10+ years analyzing countless companies, Michael has accumulated outstanding professional experience in tech and energy and a following of over 40K on Seeking Alpha.Michael is the leader of the Investing Group Deep Value Returns.Features of the group include: Insights through his concentrated portfolio of Inflection stocks, timely updates on stock picks, and "hand-holding" as-needed for new and experienced investors alike.

Deep Value Returns also has an active, vibrant, and kind community easily accessible via chat. Learn moreAnalyst’s Disclosure: I/we have a beneficial long position in the shares of APP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.