Jim Cramer on AppLovin: "It's a Buy"

AppLovin Corporation (NASDAQ:APP) is one of the stocks Jim Cramer talked about. Cramer called the company stock “a wild trader,” as he remarked:

“So AppLovin’s a bit of a wild trader and certainly not for the faint of heart. But even though the action in the stock’s crazy, I’ve never been able to fully turn against this company because it does have some of the best growth I have ever seen. AppLovin’s revenue has nearly doubled over the past three years while its earnings have gone from under a dollar per share in 2023 to 4.50 per share in 2024. Get this, the analysts expected it to earn more than $9 per share this year and then $13 and change next year.

That is just, wow, that’s neckbreaking. Of course, the stock’s had a monster run, so it’s trading at about 60 times this year’s earnings estimates and 41 times next year’s numbers. Given AppLovin’s turbocharged growth rate, though, the valuation may turn out to be cheap. It’s not cheap, now; it could be justifiable, though. The thing is, bulls and AppLovin have been betting on the stock getting… [in] the S&P 500 for a while now. It’s finally happened. I expect some selling going forward as people ring the register. If you want to buy this one, you should pay for that weakness to give you a better entry point. I would not go in tomorrow and buy it. Frankly, I don’t know enough about advertising technology to explain why AppLovin is so darn good, but it’s already jumped from mobile game ads to e-commerce ads, a much larger market, so I think management’s earned the benefit of the doubt here. Some people think it’s a mini Alphabet. The company doesn’t report again until November. Between now and then, I’m betting you’ll get a better opportunity to buy this one as long as you’re patient, but it’s a buy.”

AppLovin Corporation (NASDAQ:APP) provides a software platform that helps advertisers and publishers improve app marketing and monetization through solutions like AppDiscovery, MAX, Adjust, and Wurl. Additionally, it offers app management tools and operates free-to-play mobile games.

While we acknowledge the potential of APP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.