Key Takeaways
- AppLovin has lost 54% over the past year, and on Oct. 12 Oppenheimer cut its price target to $490 from $560 while keeping its Outperform rating, a target 81% above the share price.
- The slide sped up after second-quarter revenue fell short of expectations, which management blamed on a smaller lift than usual from its ad models.
- Oppenheimer’s target sits on the $488 consensus and implies a forward P/E of 26.2x, close to the stock’s five-year average of 25.8x and well above the 14.8x it traded at on Oct. 9.
- The call is plausible but stretched: it needs investors to pay an average multiple again, and the third-quarter report is the test.
AppLovin (APP) has lost 54% over the past year. On Oct. 12, Oppenheimer analyst Martin Yang cut his price target to $490 from $560 and kept his Outperform rating, a target 81% above the stock’s $271.23 that afternoon.
The quarter that broke the streak
Revenue rose 53% to $1.92 billion in the three months to June 30, 2026, short of the $1.94 billion analysts expected, according to LSEG. The stock fell 19% on Aug. 6.
CEO Adam Foroughi’s explanation on the call:
“In this case, in Q2, we didn’t have the same amount of uplift that we normally have in any other prior quarter. That came right after the quarter.”
The news since has piled on. A class action alleges AppLovin misled investors about the strength of its AI models and its AI video creative tool, and on Oct. 1 a San Francisco court denied AppLovin’s request for a restraining order against Unity Software (U) and its Ad Quality SDK.
Oppenheimer is sticking with it
This is Oppenheimer’s second cut since August, when it lowered its target to $560 from $660. It put that miss down to timing: a significant model lift landed just after quarter-end and was already driving a third-quarter re-acceleration. That’s management’s story too.
Does $490 add up?
Oppenheimer is hardly out on a limb. Its $490 sits right on the $488 consensus target, which has fallen from $744 in mid-January.
The range runs from $325, where Wells Fargo, Bank of America and Piper Sandler sit with Hold ratings, to $790. Holds doubled from 3 on June 30 to 6 on Oct. 9, though 27 of 33 ratings are still Buy or Outperform.
Earnings estimates have held up far better. Analysts expect normalized EPS to climb from $10.64 in 2025 to $20.78 in 2027.
They’ve trimmed: the 2027 consensus is $19.96 a share, down from $21.09 90 days ago, according to Yahoo Finance. But it was $20.04 a month ago, so estimates have steadied while the targets kept falling.
What’s collapsed is the multiple.
At 14.8x forward earnings on Oct. 9, the stock trades well below its five-year average of 25.8x. Divide the $277.04 close by 14.8x and you get $18.72 of earnings a share over the next twelve months. Oppenheimer’s $490 is 26.2x that, right around the stock’s own average.
A target that needs a comeback
The risk is that the second quarter wasn’t a one-off. If the model lifts stay small, estimates fall further, and even an average multiple won’t get the stock to $490.
I think Oppenheimer’s call is plausible but stretched. It asks only for AppLovin’s usual valuation on earnings analysts already expect, but investors won’t pay that again until the lifts show up in the numbers.
The test is the third-quarter report, against guidance of $2.06 billion to $2.09 billion in revenue. If AppLovin lands at the top of that range or beats it, $490 looks a lot more within reach.
So what is AppLovin stock actually worth?
TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR’s valuation model and see what AppLovin could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It’s free to use.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
