MODEL VERDICT
AppLovin Corporation (APP) — Relative Valuation
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Popular:
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| Feb 28, 2026 | NEUTRAL | 0.46 | $434.77 | CURRENT | — |
| Feb 21, 2026 | NEUTRAL | 0.52 | $418.68 | CURRENT | — |
| Feb 14, 2026 | NEUTRAL | 0.19 | $390.55 | CURRENT | — |
| Feb 11, 2026 | NEUTRAL | 0.18 | $472.92 | CURRENT | — |
| Jan 11, 2026 | NEUTRAL | 0.24 | $647.72 | Below threshold | -28.9% |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 113 analyst estimates | $315.45 | -27.4% | 20% | A- | Analyst Est. |
| EV/EBITDA 80 industry peers | $259.53 | -40.3% | 20% | A- | Peer Data |
| Industry Median P/E 71 industry peers | $253.16 | -41.8% | 15% | A | Peer Data |
| Price / Free Cash Flow 105 industry peers | $226.77 | -47.8% | 15% | B+ | Peer Data |
| EV/EBIT 77 industry peers | $300.17 | -31.0% | 8% | B+ | Peer Data |
| EV/FCF 107 industry peers | $207.03 | -52.4% | 7% | B | Model Driven |
| EV To Revenue 124 industry peers | $51.98 | -88.0% | 4% | B | Data |
| Price / Sales 125 industry peers | $53.00 | -87.8% | 3% | B | Model Driven |
| Earnings Yield 75 industry peers | $267.82 | -38.4% | 2% | B | Data |
| FCF Yield 107 industry peers | $227.04 | -47.8% | 1% | B | Data |
| Weighted Output Blended model output | $505.07 | +16.2% | 100% | 74 | UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 37× | 41× | 45× (Current) | 49× | 53× |
|---|---|---|---|---|---|
| Bear Case (4%) | $375 | $416 | $456 | $497 | $537 |
| Conservative (7%) | $384 | $426 | $467 | $509 | $550 |
| Base Case (10.0%) | $397 | $440 | $483 | $526 | $568 |
| Bull Case (14%) | $409 | $454 | $498 | $542 | $587 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 298.70 | 70.30 | 40.66 | 1013.55 | 476.77 |
| EV/EBIT | 92.76 | 58.35 | 26.09 | 228.25 | 91.62 |
| EV/EBITDA | 37.80 | 49.72 | 12.24 | 58.72 | 22.30 |
| P/FCF | 44.92 | 53.78 | 9.49 | 89.63 | 33.47 |
| P/FFO | 43.64 | 55.53 | 11.04 | 69.26 | 27.54 |
| P/AFFO | 38.34 | 36.41 | 11.06 | 69.46 | 28.64 |
| P/B Ratio | 47.99 | 15.11 | 2.06 | 107.94 | 52.87 |
| P/S Ratio | 16.66 | 11.57 | 1.39 | 42.04 | 16.63 |
Based on our peer multiples analysis with 26 valuation metrics, the model estimates APP's fair value at $505.07 vs the current price of $434.77, implying +16.2% upside potential. Model verdict: Undervalued. Confidence: 74/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $505.07 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $283.69 (P10) to $941.17 (P90), with a median of $512.83.
APP's current P/E of 44.6x compares to the industry median of 26.0x (71 peers in the group). This represents a +71.7% premium to the industry. The historical average P/E is 298.7x over 4 years. Signal: High Premium.
26 analysts cover APP with a consensus rating of Buy. The consensus price target is $690.93 (range: $543.00 — $835.00), implying +58.9% upside from the current price. Grade breakdown: Strong Buy (0), Buy (23), Hold (2), Sell (1), Strong Sell (0).
The model confidence score is 74/100, based on: data completeness (27), peer quality (25), historical depth (16), earnings stability (4), and model agreement (2). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Margin reversion: Current net margin of 60.8% is 46.8 percentage points above the 4-year average (14.1%), with a Z-score of +1.9σ. If margins normalize, fair value could drop to ~$674. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that APP's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +1.9σ, meaning margins are 1.9 standard deviations above their historical average. If margins revert to the 4-year mean (14.1%), the model estimates fair value drops by 5500.0% to approximately $674. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.