APPLOVIN CORP-CLASS A (APP) Stock Fundamental Analysis
NASDAQ:APP - Nasdaq - US03831W1080 - Common Stock - Currency: USD
Taking everything into account, APP scores 7 out of 10 in our fundamental rating. APP was compared to 284 industry peers in the Software industry. APP gets an excellent profitability rating and is at the same time showing great financial health properties. APP is growing strongly while it is still valued neutral. This is a good combination! With these ratings, APP could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
APP had positive earnings in the past year.
APP had a positive operating cash flow in the past year.
In multiple years APP reported negative net income over the last 5 years.
APP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 33.63%, APP belongs to the best of the industry, outperforming 98.59% of the companies in the same industry.
Looking at the Return On Equity, with a value of 333.52%, APP belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
With an excellent Return On Invested Capital value of 43.87%, APP belongs to the best of the industry, outperforming 98.94% of the companies in the same industry.
APP had an Average Return On Invested Capital over the past 3 years of 14.51%. This is above the industry average of 12.30%.
The 3 year average ROIC (14.51%) for APP is below the current ROIC(43.87%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 33.63% | ||
| ROE | 333.52% | ||
| ROIC | 43.87% |
ROA(3y)10.07%
ROA(5y)4.98%
ROE(3y)54.28%
ROE(5y)N/A
ROIC(3y)14.51%
ROIC(5y)9.34%
1.3 Margins
With an excellent Profit Margin value of 37.37%, APP belongs to the best of the industry, outperforming 97.54% of the companies in the same industry.
APP's Profit Margin has improved in the last couple of years.
APP's Operating Margin of 46.47% is amongst the best of the industry. APP outperforms 99.30% of its industry peers.
APP's Operating Margin has improved in the last couple of years.
APP has a better Gross Margin (77.72%) than 75.00% of its industry peers.
APP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.47% | ||
| PM (TTM) | 37.37% | ||
| GM | 77.72% |
OM growth 3Y94.94%
OM growth 5Y15.26%
PM growth 3Y209.01%
PM growth 5Y34.23%
GM growth 3Y5.19%
GM growth 5Y-0.13%
2. Health
2.1 Basic Checks
APP has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
APP has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for APP has been reduced compared to 5 years ago.
The debt/assets ratio for APP has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 17.70 indicates that APP is not in any danger for bankruptcy at the moment.
The Altman-Z score of APP (17.70) is better than 92.25% of its industry peers.
The Debt to FCF ratio of APP is 1.46, which is an excellent value as it means it would take APP, only 1.46 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.46, APP is doing good in the industry, outperforming 71.48% of the companies in the same industry.
A Debt/Equity ratio of 6.10 is on the high side and indicates that APP has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 6.10, APP is doing worse than 83.45% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for APP, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.1 | ||
| Debt/FCF | 1.46 | ||
| Altman-Z | 17.7 |
ROIC/WACC3.91
WACC11.23%
2.3 Liquidity
APP has a Current Ratio of 1.68. This is a normal value and indicates that APP is financially healthy and should not expect problems in meeting its short term obligations.
APP has a Current ratio (1.68) which is comparable to the rest of the industry.
A Quick Ratio of 1.68 indicates that APP should not have too much problems paying its short term obligations.
APP has a Quick ratio (1.68) which is comparable to the rest of the industry.
APP does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.68 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 262.50% over the past year.
The Earnings Per Share has been growing by 84.87% on average over the past years. This is a very strong growth
Looking at the last year, APP shows a very strong growth in Revenue. The Revenue has grown by 41.63%.
The Revenue has been growing by 36.49% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)262.5%
EPS 3Y269.34%
EPS 5Y84.87%
EPS Q2Q%231.34%
Revenue 1Y (TTM)41.63%
Revenue growth 3Y19.02%
Revenue growth 5Y36.49%
Sales Q2Q%40.25%
3.2 Future
APP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.97% yearly.
The Revenue is expected to grow by 21.14% on average over the next years. This is a very strong growth
EPS Next Y54.09%
EPS Next 2Y55.53%
EPS Next 3Y45.51%
EPS Next 5Y31.97%
Revenue Next Year24.72%
Revenue Next 2Y22.67%
Revenue Next 3Y23.39%
Revenue Next 5Y21.14%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 62.96 indicates a quite expensive valuation of APP.
APP's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of APP to the average of the S&P500 Index (26.55), we can say APP is valued expensively.
The Price/Forward Earnings ratio is 34.91, which means the current valuation is very expensive for APP.
APP's Price/Forward Earnings is on the same level as the industry average.
APP's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 62.96 | ||
| Fwd PE | 34.91 |
4.2 Price Multiples
66.90% of the companies in the same industry are more expensive than APP, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, APP is valued a bit cheaper than the industry average as 60.56% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 51.22 | ||
| EV/EBITDA | 47.45 |
4.3 Compensation for Growth
APP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of APP may justify a higher PE ratio.
APP's earnings are expected to grow with 45.51% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.16
PEG (5Y)0.74
EPS Next 2Y55.53%
EPS Next 3Y45.51%
5. Dividend
5.1 Amount
No dividends for APP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
383.43
-0.18 (-0.05%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners69.77%
Inst Owner Change5.67%
Ins Owners4.11%
Ins Owner Change-0.68%
Market Cap129.75B
Analysts81.29
Price Target481.69 (25.63%)
Short Float %4.18%
Short Ratio1.21
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)44.78%
Min EPS beat(2)38.1%
Max EPS beat(2)51.45%
EPS beat(4)4
Avg EPS beat(4)35.11%
Min EPS beat(4)16.95%
Max EPS beat(4)51.45%
EPS beat(8)8
Avg EPS beat(8)51.1%
EPS beat(12)8
Avg EPS beat(12)-30.98%
EPS beat(16)8
Avg EPS beat(16)-70.07%
Revenue beat(2)2
Avg Revenue beat(2)6.86%
Min Revenue beat(2)6.23%
Max Revenue beat(2)7.5%
Revenue beat(4)3
Avg Revenue beat(4)4.37%
Min Revenue beat(4)-1.18%
Max Revenue beat(4)7.5%
Revenue beat(8)7
Avg Revenue beat(8)4.56%
Revenue beat(12)9
Avg Revenue beat(12)2.5%
Revenue beat(16)12
Avg Revenue beat(16)1.21%
PT rev (1m)0.73%
PT rev (3m)-6.05%
EPS NQ rev (1m)39.92%
EPS NQ rev (3m)42.76%
EPS NY rev (1m)5.14%
EPS NY rev (3m)9.84%
Revenue NQ rev (1m)-2.97%
Revenue NQ rev (3m)-3.65%
Revenue NY rev (1m)-0.21%
Revenue NY rev (3m)-0.91%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 62.96 | ||
| Fwd PE | 34.91 | ||
| P/S | 25.27 | ||
| P/FCF | 51.22 | ||
| P/OCF | 51.12 | ||
| P/B | 225.49 | ||
| P/tB | N/A | ||
| EV/EBITDA | 47.45 |
EPS(TTM)6.09
EY1.59%
EPS(NY)10.98
Fwd EY2.86%
FCF(TTM)7.49
FCFY1.95%
OCF(TTM)7.5
OCFY1.96%
SpS15.18
BVpS1.7
TBVpS-5.67
PEG (NY)1.16
PEG (5Y)0.74
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 33.63% | ||
| ROE | 333.52% | ||
| ROCE | 55.53% | ||
| ROIC | 43.87% | ||
| ROICexc | 50.32% | ||
| ROICexgc | 150.62% | ||
| OM | 46.47% | ||
| PM (TTM) | 37.37% | ||
| GM | 77.72% | ||
| FCFM | 49.33% |
ROA(3y)10.07%
ROA(5y)4.98%
ROE(3y)54.28%
ROE(5y)N/A
ROIC(3y)14.51%
ROIC(5y)9.34%
ROICexc(3y)16.97%
ROICexc(5y)11.03%
ROICexgc(3y)60.6%
ROICexgc(5y)N/A
ROCE(3y)18.38%
ROCE(5y)11.84%
ROICexcg growth 3Y130.56%
ROICexcg growth 5YN/A
ROICexc growth 3Y131.06%
ROICexc growth 5Y6.08%
OM growth 3Y94.94%
OM growth 5Y15.26%
PM growth 3Y209.01%
PM growth 5Y34.23%
GM growth 3Y5.19%
GM growth 5Y-0.13%
F-Score8
Asset Turnover0.9
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.1 | ||
| Debt/FCF | 1.46 | ||
| Debt/EBITDA | 1.25 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 11.82 | ||
| Cash Conversion | 90.57% | ||
| Profit Quality | 132% | ||
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.68 | ||
| Altman-Z | 17.7 |
F-Score8
WACC11.23%
ROIC/WACC3.91
Cap/Depr(3y)1.05%
Cap/Depr(5y)1.13%
Cap/Sales(3y)0.16%
Cap/Sales(5y)0.18%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)262.5%
EPS 3Y269.34%
EPS 5Y84.87%
EPS Q2Q%231.34%
EPS Next Y54.09%
EPS Next 2Y55.53%
EPS Next 3Y45.51%
EPS Next 5Y31.97%
Revenue 1Y (TTM)41.63%
Revenue growth 3Y19.02%
Revenue growth 5Y36.49%
Sales Q2Q%40.25%
Revenue Next Year24.72%
Revenue Next 2Y22.67%
Revenue Next 3Y23.39%
Revenue Next 5Y21.14%
EBIT growth 1Y157.5%
EBIT growth 3Y132.02%
EBIT growth 5Y57.32%
EBIT Next Year123.13%
EBIT Next 3Y53.38%
EBIT Next 5Y38.38%
FCF growth 1Y248.78%
FCF growth 3Y80.45%
FCF growth 5Y60.75%
OCF growth 1Y246.17%
OCF growth 3Y79.67%
OCF growth 5Y60.27%