The aptly named Applovin (APP) is like an online dating site, but instead of matching individuals seeking love, the company matches mobile app developers with over 1.4 billion daily active users to market, monetize, and analyze their applications. The company utilizes its AI-powered recommendation engine, Axon, to help app developers optimize ad campaigns by targeting users, as well as game developers to publish and promote their gaming apps. The stock was added to our growth portfolio in August of 2024 (orange arrow on the daily chart below) on a breakout from consolidation. The stock is now entering another consolidation phase and showing impressive relative strength amidst the Chinese AI competition shakeup. The shares were down 5% on Monday, but are still up 10% so far in 2025. It's my belief that when, not if, the hardware corner of western technology companies stabilizes, software and communication companies like this will power ahead. I will be looking to increase the target allocation from current levels on the next portfolio re-allocation at Inside Edge Capital. The company is one of the best performing names in the past 2 years up from around $9.00 in 2023 to current levels of $364. On the weekly chart below you'll notice a clean breakout from $115.00 resistance, which is the kind of price action I "love" to see. Looking below the chart at the yearly EPS figures the company went from making $0.18 in all 4 quarters of 2022, to $0.98 in 2023, and if they the street estimate in Q4 of '24 to be reported on Feb 12th, 2025, they'll make $4.06. Those are growth rates of 100%, 444%, 314%, and expectations are for only a 49% EPS growth rate in 2025 with $6.07 in EPS. Those look like NVDA numbers. Turning to the daily chart, the stock is falling into a blue consolidation pattern of a clearly defined flat base/support level around $310 and a topside resistance level at around $375. Earnings are due on Feb 12th and if you look at the stock performance following earnings in the prior 4th quarters the stock was higher one week later in 3 of those quarters with significant volume traded on the earnings date. I'm expecting another beat and raise quarter for this company and will look to increase my holdings prior to that Feb 12th date. -Todd Gordon, Founder of Inside Edge Capital, LLC DISCLOSURES: (Gordon owns APP in his wealth management company Inside Edge Capital, LLC. Charts shown are Deepvue.) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
