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Investment portfolio spreadsheet with all of my core holdings, non-core holdings, swing trades and hedges
Investment portfolio spreadsheet also contains real-time activity (buys, sells, adds, trims) plus real-time notes/commentary/charts throughout the day
My investment portfolio is up +188.5% in 2024, after being up +134.7% in 2023 and now up +2,950% since January 2020 when I got back into investing full-time.
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Here’s my investment strategy which focuses on high-quality growth stocks… I own 15-20 core holdings (great fundamentals, compelling valuation) plus another 5-10 non-core holdings (good fundamentals, reasonable valuation) plus another 5-10 swing trades (good fundamentals, reasonable valuation, compelling technicals).
As long as the fundamentals remain strong and valuation remains compelling/reasonable, then I’ll add on pullbacks.
I only want to own stocks that have at least 50% upside within the next 1-2 years and at least 100% upside within the next 3-4 years.
My objective is to maximize the upside in good markets and minimize the downside in bad markets. I accomplish this by being very selective with my stock picking and disciplined on valuations while using a variety of hedging strategies to protect my gains in market downturns.
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Once you’re a TrendSpider customer, email them at hello@trendspider.com and ask for Jonah’s custom scanners which they can load into your account. This includes the follow scanners: pre-breakout, breakout & retest, power gap and power earnings gap. We’re also making the final tweaks to the VWAP breakthrough scanner.
APP Q2 earnings report: https://s27.q4cdn.com/966411597/files/doc_financials/2024/q2/2Q24-AppLovin-Shareholder-Letter.pdf
APP Q2 earnings webcast: https://s27.q4cdn.com/966411597/files/doc_financials/2024/q2/2024-Q2-Earnings-Call-and-QA-02.mp4
APP Form 10-Q: https://s27.q4cdn.com/966411597/files/doc_financials/2024/q2/60f699fc-5521-4c15-8165-8eecb688d4ea.pdf
Investment Thesis
AppLovin runs one of the most sophisticated mobile advertising platforms in the world, processing tens of billions of dollars of transactional volume and driving billions of dollars in profits for advertisers, predominantly in the mobile gaming segment.
The company also has a diversified portfolio of around 150 free-to-play mobile games across five genres, run by eleven studios it owns.
In 2023, AppLovin made a strategic decision to shift its focus from its Apps business, which was starting to stagnate because of intense competition, higher user acquisition costs, and low user retention rates, to the Software business, which began to see rapid growth alongside improving margins, profitability, and cash flow generation.
Its AI-based recommendation engine, AXON 2.0, launched in mid-2023, was the primary reason for this rapid turnaround. AXON 2.0 is driving incredible efficiency in ad spending for AppLovin's clients, which leads to more spending and more profits for both sides.
In the second quarter of 2024, the company celebrated the first anniversary of AXON, which continues to improve thanks to more data and better models. Personally I don’t think AppLovin is getting enough credit for AXON.
The early success of AXON 2.0, combined with some industry tailwinds and expansion to other markets beyond gaming and mobile (ie ecommerce), is laying the foundation for many more years of strong growth and margin expansion. Management keeps saying they should be able to maintain 25-30% revenue growth for several more years but it seems like the market doesn’t believe them, otherwise AppLovin should be trading above $100 per share.
Even though AppLovin is expected to grow EBITDA and FCF this year by 60-70%, the stock is only trading at 10.5x NTM EV/EBITDA and 13.2x NTM EV/FCF.
This might be because the analysts are looking for growth to slowdown over the next few years into the mid-teens however if you listen to these earnings calls, this is not what management is forecasting. I think there’s a good chance that AppLovin is growing revenues for the next few years at 2x the consensus growth rates which means the street estimates are way too low and the upside to APP could be significant with higher earnings, multiple expansion and stock buybacks.
While its main competitor, Unity, is going through a reorganization to identify and fix various business issues, AppLovin has become the primary channel for advertisers in the mobile gaming segment and may soon become a strong competitor in other advertising channels which means the upside to current street estimates for next few years could be substantial.