| Account | Shares | Price | Value | % of acct | Cost/sh | Gain $ | Gain % | Target |
|---|---|---|---|---|---|---|---|---|
| HSA | 1 | $319.05 | $319 | 0.30% | $323.00 | $-4 | -1.2% | — |
| ROTH | 3 | $313.29 | $940 | 0.37% | $321.17 | $-24 | -2.5% | — |
| Total | 4 | $1,259 | 0.03% | $-28 | -2.1% | — |
In short: Morgan Stanley cuts the target to $450 from $650; Terranova: don't buy near a 52-week low. "This is a broken momentum stock. It's now [−]42% if you're looking at a 12 month momentum score… three month momentum score, it's down as well… in the JOET ETF, the next quarterly rebalance… we'll figure on the position. As far as advocating it to buy it here, I don't think you want to do that. I don't like buying stocks that are near a 52 week low despite what might be the vision of some really good fundamentals ahead… allow the stock to stabilize and begin the recovery period, then step in… Let it prove itself first." He applies the same rule to the AI industrials.
AppLovin runs software that places ads inside mobile apps and games. The stock ran above $600 and has fallen hard; Morgan Stanley just cut its target to $450.
Terranova is a momentum investor: he owns what is going up and avoids what is going down. AppLovin is down about 42% on his 12-month measure, so his rule says don't buy it, however good the business might look. Wait for the price to stop falling and start recovering, then buy — "let it prove itself first." You give up the bottom in exchange for not buying something that keeps dropping.
In short: Cited first on EPS growth: "AppLovin: +98.3%" — second on the sort behind IHG (235.0%). FCF margin 58.8% (the highest among the named names), ROIC 75.4%, ROCE 65.1%, $104.9bn market cap. Listed only; first mention in this archive.
In short: Terranova's negative half of the two-name software aside: "AppLovin — it's at a 52 week low. Why? In early August the earnings didn't show up." Contrasted directly with Zoom, where he wants to take the other side of the selling.
AppLovin, which runs advertising technology for mobile apps, is at a 52-week low, and Terranova's explanation is refreshingly plain: the earnings simply did not show up in early August. Not a valuation story, not a narrative story — a miss.
He pairs it deliberately with Zoom to make a distinction worth copying: buy the stock that fell because owners rotated away, avoid the stock that fell because the numbers were bad.
In short: First look, "going in a little blind": down ~60% from $733 to ~$300 while TTM revenue grows 47%, net income 81%, FCF 58% with little stock comp — "I immediately understand why investors are interested." Bull case: Q2 slowdown was model-release timing; bear case: growth depends on "discrete, unpredictable model breakthroughs" and an unproven e-commerce leg. "I like the setup… teens forward PE"; still researching.
AppLovin runs an advertising system that matches advertisers (first mobile games, now online shops) with ad space inside apps, using its AI model to predict which ad will pay off. The stock fell about 60% from its peak even though revenue is still growing about 47% a year and profits even faster, which is why it has become popular on Qualtrim.
Carlson was looking at it for the first time. Optimists say a recent slowdown was just the timing of a model upgrade; skeptics say growth depends on unpredictable breakthroughs and that the push beyond games is unproven. He likes the setup — a beaten-down, fast-growing, cash-rich company at a low teens earnings multiple — but hasn't done the work to take a position.
In short: In the selective non-AI growth cluster of Q2 top buys: "APP, UBER, MELI, RDDT, DASH, NFLX, SNOW, TWLO, and NOW all attracted buyers. This still looks more like stock picking than a broad rush back into software." A disclosed author holding.
In short: Named as a call "we got a little bit wrong" but still owned with conviction: average cost in the low 300s against 312, underwater ~$20-25 a share, "a wonderful company" with ~50% upside that "could be easily back at 500 over the next 2 years." B of A's worry is deceleration from 30% to mid-20% revenue growth — "which is still phenomenal."
AppLovin runs the advertising engine behind mobile apps and, increasingly, e-commerce. Singh is honest that this is a call he got "a little bit wrong" so far: his average cost is in the low 300s against a price of 312, leaving him roughly $20-25 a share underwater at one point.
He is holding anyway. Bank of America's worry is that revenue growth slows from 30% to the mid-20s — which he points out is still exceptional. He sees about 50% upside and thinks the stock "could be easily back at 500 over the next 2 years."
42:58But App, after the re-rating, I mean, there are a lot of top-tier hedge funds in this name, and our average cost for App is like kind of the low 300s. It's currently at 312. We're underwater a little bit by about probably about $20 a share, $25 a share. And I think that this stock could be easily back at 500 over the next 2 years, but it's very tough to trade some of these names that are growing like Shopify, which was a name that we added to recently. It had blowout
In short: Dorsey's second-largest position, added to meaningfully over the past three months, and described approvingly: "this is one that has outstanding growth. It's one that helps different companies monetize and advertise, especially on mobile. They've carved out a very good market position for themselves there." Growing "47% year over year on a trailing 12-month basis"; he flags it as a higher-volatility name.
AppLovin sells the software that helps app makers — mostly mobile games and consumer apps — find users and turn them into paying customers. It sits between advertisers and app audiences and takes a cut of the spending it makes more effective.
It's Pat Dorsey's second-largest position and he added meaningfully over the past three months. Carlson's description is approving on both the growth and the position: "outstanding growth… they've carved out a very good market position for themselves," compounding at 47% year over year on a trailing-twelve-month basis.
The caveat he attaches is about the ride, not the business: this is a name "you're going to see trade around with a lot more volatility" — high growth priced aggressively means the price swings hard in both directions.
20:11He added meaningfully to it over the past 3 months. And this is one that has outstanding growth. It's one that helps different companies monetize and advertise, especially on mobile. They've carved out a very good market position for themselves there. So, it's the type of one that you're going to see it trade around with a lot more volatility.
In short: Bought the downgrade: BofA cut APP to neutral with a $400 target, analyst Omar Dasuki arguing post-Q2 growth "appears to be driven more by engineer-directed improvements to gaming models, while it's less clear whether the prior 3 to 5% quarter over quarter self-learning growth assumption still applies," i.e. risks to the long-term 30% revenue trajectory. His response: "We'll see how that plays out. We do think the company's a lot cheaper now, and added a little bit in the low 300s." Also named as the competitive threat to Unity's grow segment via Axon 2.0.
AppLovin sells advertising inside mobile apps using an AI system that learns which ads to show whom. Bank of America downgraded it to neutral with a $400 target, arguing that recent growth came from engineers hand-tuning the models rather than the models teaching themselves — which, if true, means the 3-5% of growth per quarter that investors assumed came "for free" may not repeat.
Singh's response was to buy more in the low $300s. His view is that the distinction between engineer-driven and self-learning improvement matters far less than the price you pay, and the downgrade made the price better. Note the tension he leaves open on the same call: AppLovin is also the main competitive risk to Unity, his featured long. He owns both sides of mobile ad-tech deliberately.
Full passage: premium transcript (PDF).
In short: Bought the post-earnings gap: "a very, very modest miss — less than 1% — and the stock was down double digits." The real disappointment was a 27% free-cash-flow miss, but that was timing of international cash and tax payments, and Q3 revenue guidance was in line, "which means they're monetizing their clients better." Management blamed model timing — a lighter-than-normal pace of AI model improvement in Q2 with the step-up landing just after quarter-end. "If this was truly a hiccup like the management was saying, and on-app advertising is less disruptible by AI, the stock could double over two years from the mid-300 level we added." An SEC inquiry remains outstanding; UBS's note is deck page 57.
AppLovin sells advertising inside mobile apps. It reported a quarter that missed expectations by less than 1% and the stock fell by double digits. The number that actually scared people was cash flow, which came in 27% light — but that turned out to be the timing of international tax payments, not lost business.
The other explanation management gave is worth understanding: AppLovin's ad engine is an AI model that gets steadily better at matching ads to users, and that improvement ran slower than usual during the quarter, with the step-up arriving right after it closed. Meanwhile guidance for the next quarter was unchanged, meaning the company is squeezing more revenue out of the same customers.
Singh bought the drop, and his broader reason is defensive: advertising shown inside an app you already opened is much harder for an AI chatbot to disintermediate than advertising that depends on someone typing a search query. He thinks the stock can double in two years from the mid-$300s. An open SEC inquiry is the live risk.
Full passage: premium transcript (PDF).
In short: Model timing miss. Q2 revenue +53% Y/Y to $1.92B — but a $20M miss — with GAAP EPS $3.77 ($0.02 beat) and adjusted EBITDA +58% to $1.61B at an 84% margin, slightly below guidance; shares plunged more than 20%. The cause was AI model cadence: AppLovin "had fewer meaningful model improvements during Q2 than usual, with the next major performance upgrade landing just after quarter-end. Because better targeting improves advertiser returns and unlocks more spend, the cadence of model releases can materially move quarterly growth" — management says demand and competition did not weaken and Q3 has already reaccelerated. The consumer expansion is slower than June's launch implied: AXON, its AI ad-buying platform, opened to broader self-serve advertisers, but growth still comes from a small number of advertisers scaling spend, with creative the biggest onboarding bottleneck — its GenAI tools can't yet consistently produce the 30–60 second videos many advertisers need. Q3 guided to $2.06–$2.09B revenue and $1.71–$1.74B adjusted EBITDA, both slightly below consensus, absorbing higher AI compute spend. One overhang cleared: the SEC concluded its inquiry with no recommended enforcement action. Bottom Line: "Q3 now needs to prove the miss really was timing rather than a lower growth ceiling." A disclosed author holding.
In short: Down more than 18% — "in fairness to Bill Baruch, who's suffering through that pain today." He owns it small: "revenue miss… Q3 forecast largely in line, but the lack of another blowout forecast obviously was a headwind. Costs were up. I think this is something that, you know, it could be an opportunity" on the weakness. A small, held position rather than a fresh call.
In short: "A name that we've added to recently," reporting Wednesday after the close. The driver is e-commerce clients onboarding onto the ad engine: "I think AppLovin is actually quite cheap relative to its growth on a PEG ratio."
Full passage: premium transcript (PDF).
In short: "We also added to APP… we're adding to our growth position in AppLovin." Very strong adoption from e-commerce companies testing the ad engine as it enters a new vertical, and "there are so many new e-commerce platforms, it's not really AI-disruptible" → ~50% upside. The model is deck page 43 (saved here: valuation model).
AppLovin runs an advertising engine that decides which ad to show you inside mobile apps — and it has been expanding beyond games into e-commerce advertising, a much larger market. Singh added to the position this week and sees roughly 50% upside.
His key argument is defensive: with so many new e-commerce platforms needing to buy customers, AppLovin's business "is not really AI-disruptible" — AI doesn't remove the need for someone to match an advertiser to a buyer, and AppLovin's data and placement network are the hard part. The full workings are in the valuation model saved with this call (deck page 43).
Full passage: premium transcript (PDF).
In short: A research home-run — his analysts cracked the ad-tech S-curve early (followed it private) and built conviction before the market.
AppLovin is an advertising-technology ("ad-tech") company, and Sacerdote cites it as a research home-run rather than an AI story. Two of his analysts cracked the AppLovin story before the rest of the market, tracked it back when it was still private, learned all its competitors, and built a relationship with its CEO.
His point is about process: deep, old-fashioned "scuttlebutt" research — talking to everyone around a company — found the winner early, and "I don't see AI doing that."
1:08:16And like the job that the guys did on app 111 two years ago. I mean I think we got two of the best adte guys around and they you know they convinced me to buy I knew adte... but Michael and Sam really figured out the Apploven story like before anybody and they followed it when it was private. They know all the competitors... and they did the work on the model and developed a great relationship with Adam Ferogi. He's one of the best managers out there. And um I don't see AI doing that.
In short: Cole — "SaaS destruction" group. Named among the software names in the crushed cohort.
17:28apploving — constellations — constellation software in Canada open text is another you know kind of out there so I say that because that world is getting crushed — and those were the former darling quality growth stories and the only place that really hasn't underperformed is the big cap tech or what we call internally the hyperscalers okay now what do we liken this to and this will be to Bill's point this will be what my presentation's on tomorrow in effect I think we think of the hyperscalers like the telecoms of the late 90s. So in
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