Despite its growth, NASDAQ:APP remains within the realm of affordability.

Last update: Jun 3, 2024

Our stock screening tool has pinpointed APPLOVIN CORP-CLASS A (NASDAQ:APP) as a growth stock that isn't overvalued. NASDAQ:APP is excelling in various growth indicators while maintaining a solid financial footing. Furthermore, it remains attractively priced. Let's delve into the specifics below.

Looking at the Growth

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:APP has received a 7 out of 10:

APP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 863.64%, which is quite impressive.
APP shows a strong growth in Revenue. In the last year, the Revenue has grown by 24.73%.
APP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 46.69% yearly.
Based on estimates for the next years, APP will show a very strong growth in Earnings Per Share. The EPS will grow by 32.41% on average per year.
The Revenue is expected to grow by 9.04% on average over the next years. This is quite good.

Looking at the Valuation

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:APP has achieved a 6 out of 10:

61.23% of the companies in the same industry are more expensive than APP, based on the Price/Earnings ratio.
75.00% of the companies in the same industry are more expensive than APP, based on the Price/Forward Earnings ratio.
Based on the Enterprise Value to EBITDA ratio, APP is valued cheaply inside the industry as 83.33% of the companies are valued more expensively.
APP's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. APP is cheaper than 79.35% of the companies in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
APP has a very decent profitability rating, which may justify a higher PE ratio.
APP's earnings are expected to grow with 67.80% in the coming years. This may justify a more expensive valuation.

Health Assessment of NASDAQ:APP

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:APP has achieved a 7 out of 10:

An Altman-Z score of 4.90 indicates that APP is not in any danger for bankruptcy at the moment.
APP's Altman-Z score of 4.90 is fine compared to the rest of the industry. APP outperforms 70.29% of its industry peers.
APP has a debt to FCF ratio of 3.03. This is a good value and a sign of high solvency as APP would need 3.03 years to pay back of all of its debts.
APP has a better Debt to FCF ratio (3.03) than 65.22% of its industry peers.
APP has a Current Ratio of 2.11. This indicates that APP is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.11, APP is doing good in the industry, outperforming 63.04% of the companies in the same industry.
APP has a Quick Ratio of 2.11. This indicates that APP is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.11, APP is in the better half of the industry, outperforming 64.13% of the companies in the same industry.

Exploring NASDAQ:APP's Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:APP scores a 6 out of 10:

APP has a Return On Assets of 11.29%. This is amongst the best in the industry. APP outperforms 90.22% of its industry peers.
Looking at the Return On Equity, with a value of 78.16%, APP belongs to the top of the industry, outperforming 98.55% of the companies in the same industry.
APP has a Return On Invested Capital of 16.75%. This is amongst the best in the industry. APP outperforms 93.84% of its industry peers.
The 3 year average ROIC (4.97%) for APP is below the current ROIC(16.75%), indicating increased profibility in the last year.
Looking at the Profit Margin, with a value of 16.39%, APP belongs to the top of the industry, outperforming 85.14% of the companies in the same industry.
Looking at the Operating Margin, with a value of 26.32%, APP belongs to the top of the industry, outperforming 94.93% of the companies in the same industry.

More Affordable Growth stocks can be found in our Affordable Growth screener.

Check the latest full fundamental report of APP for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.