APPLOVIN CORP-CLASS A (APP) Stock Fundamental Analysis
USA - NASDAQ:APP - US03831W1080 - Common Stock
602.3 USD
+12.27 (+2.08%)
601.5 USD
-0.8 (-0.13%)
APP gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 282 industry peers in the Software industry. APP scores excellent points on both the profitability and health parts. This is a solid base for a good stock. APP is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings would make APP suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year APP was profitable.
APP had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: APP reported negative net income in multiple years.
APP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
APP's Return On Assets of 40.75% is amongst the best of the industry. APP outperforms 98.58% of its industry peers.
APP has a Return On Equity of 208.08%. This is amongst the best in the industry. APP outperforms 100.00% of its industry peers.
APP has a Return On Invested Capital of 47.95%. This is amongst the best in the industry. APP outperforms 98.58% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for APP is above the industry average of 11.88%.
The 3 year average ROIC (14.51%) for APP is below the current ROIC(47.95%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 40.75% | ||
| ROE | 208.08% | ||
| ROIC | 47.95% |
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
APP has a Profit Margin of 45.70%. This is amongst the best in the industry. APP outperforms 93.97% of its industry peers.
APP's Profit Margin has improved in the last couple of years.
APP has a better Operating Margin (55.57%) than 97.52% of its industry peers.
APP's Operating Margin has improved in the last couple of years.
The Gross Margin of APP (80.87%) is better than 83.69% of its industry peers.
APP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 55.57% | ||
| PM (TTM) | 45.7% | ||
| GM | 80.87% |
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so APP is creating value.
Compared to 1 year ago, APP has about the same amount of shares outstanding.
Compared to 5 years ago, APP has less shares outstanding
Compared to 1 year ago, APP has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 28.59 indicates that APP is not in any danger for bankruptcy at the moment.
APP has a better Altman-Z score (28.59) than 95.39% of its industry peers.
APP has a debt to FCF ratio of 1.21. This is a very positive value and a sign of high solvency as it would only need 1.21 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.21, APP is doing good in the industry, outperforming 73.40% of the companies in the same industry.
APP has a Debt/Equity ratio of 3.01. This is a high value indicating a heavy dependency on external financing.
APP's Debt to Equity ratio of 3.01 is on the low side compared to the rest of the industry. APP is outperformed by 82.62% of its industry peers.
Although APP does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.01 | ||
| Debt/FCF | 1.21 | ||
| Altman-Z | 28.59 |
ROIC/WACC4.26
WACC11.26%
2.3 Liquidity
APP has a Current Ratio of 2.74. This indicates that APP is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.74, APP is doing good in the industry, outperforming 75.18% of the companies in the same industry.
A Quick Ratio of 2.74 indicates that APP has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.74, APP is in the better half of the industry, outperforming 75.89% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.74 | ||
| Quick Ratio | 2.74 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 222.98% 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
The Revenue has grown by 34.33% in the past year. This is a very strong growth!
APP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 36.49% yearly.
EPS 1Y (TTM)222.98%
EPS 3Y269.34%
EPS 5Y84.87%
EPS Q2Q%168.54%
Revenue 1Y (TTM)34.33%
Revenue growth 3Y19.02%
Revenue growth 5Y36.49%
Sales Q2Q%16.54%
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 23.97% on average over the next years. This is a very strong growth
EPS Next Y96.71%
EPS Next 2Y74.37%
EPS Next 3Y55.19%
EPS Next 5Y31.97%
Revenue Next Year22.22%
Revenue Next 2Y27.7%
Revenue Next 3Y26.72%
Revenue Next 5Y23.97%
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
APP is valuated quite expensively with a Price/Earnings ratio of 79.35.
APP's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of APP to the average of the S&P500 Index (27.55), we can say APP is valued expensively.
With a Price/Forward Earnings ratio of 43.63, APP can be considered very expensive at the moment.
APP's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of APP to the average of the S&P500 Index (23.04), we can say APP is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 79.35 | ||
| Fwd PE | 43.63 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, APP is valued a bit cheaper than the industry average as 60.99% of the companies are valued more expensively.
APP's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 70.37 | ||
| EV/EBITDA | 62.3 |
4.3 Compensation for Growth
APP's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
APP has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as APP's earnings are expected to grow with 55.19% in the coming years.
PEG (NY)0.82
PEG (5Y)0.94
EPS Next 2Y74.37%
EPS Next 3Y55.19%
5. Dividend
5.1 Amount
APP does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
602.3
+12.27 (+2.08%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners70.06%
Inst Owner Change0.26%
Ins Owners4.73%
Ins Owner Change-0.52%
Market Cap203.73B
Analysts81.33
Price Target594.77 (-1.25%)
Short Float %6.22%
Short Ratio1.89
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)34.04%
Min EPS beat(2)16.63%
Max EPS beat(2)51.45%
EPS beat(4)4
Avg EPS beat(4)35.03%
Min EPS beat(4)16.63%
Max EPS beat(4)51.45%
EPS beat(8)8
Avg EPS beat(8)27.58%
EPS beat(12)9
Avg EPS beat(12)-18.56%
EPS beat(16)9
Avg EPS beat(16)-67.65%
Revenue beat(2)1
Avg Revenue beat(2)2.17%
Min Revenue beat(2)-1.89%
Max Revenue beat(2)6.23%
Revenue beat(4)3
Avg Revenue beat(4)4.19%
Min Revenue beat(4)-1.89%
Max Revenue beat(4)7.5%
Revenue beat(8)6
Avg Revenue beat(8)4.01%
Revenue beat(12)9
Avg Revenue beat(12)2.88%
Revenue beat(16)11
Avg Revenue beat(16)0.88%
PT rev (1m)15.21%
PT rev (3m)21.61%
EPS NQ rev (1m)0.69%
EPS NQ rev (3m)11.12%
EPS NY rev (1m)1.99%
EPS NY rev (3m)9.2%
Revenue NQ rev (1m)0.15%
Revenue NQ rev (3m)0.15%
Revenue NY rev (1m)0.67%
Revenue NY rev (3m)-0.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 79.35 | ||
| Fwd PE | 43.63 | ||
| P/S | 38.34 | ||
| P/FCF | 70.37 | ||
| P/OCF | 70.25 | ||
| P/B | 174.56 | ||
| P/tB | N/A | ||
| EV/EBITDA | 62.3 |
EPS(TTM)7.59
EY1.26%
EPS(NY)13.8
Fwd EY2.29%
FCF(TTM)8.56
FCFY1.42%
OCF(TTM)8.57
OCFY1.42%
SpS15.71
BVpS3.45
TBVpS-2.43
PEG (NY)0.82
PEG (5Y)0.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 40.75% | ||
| ROE | 208.08% | ||
| ROCE | 60.69% | ||
| ROIC | 47.95% | ||
| ROICexc | 63.51% | ||
| ROICexgc | 138.41% | ||
| OM | 55.57% | ||
| PM (TTM) | 45.7% | ||
| GM | 80.87% | ||
| FCFM | 54.49% |
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-Score9
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.01 | ||
| Debt/FCF | 1.21 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 13.11 | ||
| Cash Conversion | 87.68% | ||
| Profit Quality | 119.22% | ||
| Current Ratio | 2.74 | ||
| Quick Ratio | 2.74 | ||
| Altman-Z | 28.59 |
F-Score9
WACC11.26%
ROIC/WACC4.26
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)222.98%
EPS 3Y269.34%
EPS 5Y84.87%
EPS Q2Q%168.54%
EPS Next Y96.71%
EPS Next 2Y74.37%
EPS Next 3Y55.19%
EPS Next 5Y31.97%
Revenue 1Y (TTM)34.33%
Revenue growth 3Y19.02%
Revenue growth 5Y36.49%
Sales Q2Q%16.54%
Revenue Next Year22.22%
Revenue Next 2Y27.7%
Revenue Next 3Y26.72%
Revenue Next 5Y23.97%
EBIT growth 1Y148.91%
EBIT growth 3Y132.02%
EBIT growth 5Y57.32%
EBIT Next Year136.13%
EBIT Next 3Y58.7%
EBIT Next 5Y40.96%
FCF growth 1Y242.92%
FCF growth 3Y80.45%
FCF growth 5Y60.75%
OCF growth 1Y238.73%
OCF growth 3Y79.67%
OCF growth 5Y60.27%