AppLovin Corp (APP) PT Raised to $547 at BTIG, Remains Top Pick

BTIG analyst Clark Lampen raised the price target on AppLovin Corp (NASDAQ: APP) to $547.00 (from $483.00) while maintaining a Buy rating.

The analyst comments "2Q results were slightly ahead of our expectations and in line with the buy-side, but were less important relative to confirmation of a launch/expansion date for the self-serve ad product ("Axon Ads Manager"), which had become a source of worry late 2Q/early 3Q. Beyond the benefit of launching in the seasonally strongest quarter where a disproportionate amount of budgets are deployed (checks have suggested ~45% of annual spend in C4Q), AppLovin is expanding the base of marketers via referral program as well as their reach with non-US users now addressable (Canada, W. Europe, etc.); which allows some of APP's existing marketers to scale spend to reach customers outside the US. Between seasonal dynamics, onboarding, and reach expansion we believe 4Q sets up to be a very substantial quarter from an incremental revenue standpoint. Quantifying that is difficult, but relative to the mid $100M run-rate we've mapped to for 1Q-3Q, we believe the aforementioned factors could drive significant q/q dollar growth, and we remain comfortable with the $370M we've baked in for the quarter. Elsewhere, APP's gaming business remains strong (BTIGe +8.9% q/q in Q3) and we see no signs of deceleration ahead with supply within MAX also growing at a low-double-digit rate (a positive for peer Unity [U; Sell, $27] and competitors), and room for further supply expansion over time. On that front, we believe APP has begun to explore non-gaming supply partnerships and conference call feedback suggests supply could start to accrue 1H26. We wouldn't be surprised if there were some costs associated with transition a la MoPub in 2022, though that would ultimately be a positive in our view. Exiting the print, we see an attractive setup with the framework for non-gaming growth beginning to take shape in late '25+, and a substantial latent revision opportunity as a result. AppLovin remains a BTIG Top Pick."

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