Benchmark Names AppLovin (APP) a 2026 Top Idea, Reiterates Buy

AppLovin Corporation (NASDAQ:APP) is one of the AI Stocks Analysts Are Watching Closely. On January 6, Benchmark analyst Mike Hickey reiterated a Buy rating on the stock with a $775.00 price target. The firm has named APP as its 2026 EDM Top Idea as it sees a clear path to scalable, high margin growth this year.

The firm highlighted how AppLovin enjoys core gaming growth and is also building a second growth engine in web and e-commerce advertising. The company is attracting more advertisers, and more of them have begun adopting its self-serve AXON Ads Manager.

Moreover, new product-driven catalysts is helping expand both advertiser count and wallet share. According to AppLovin’s management, self-serve advertising are delivering early but good results, there is improving ROAS from prospecting campaigns, and also incremental conversion upside from AI-driven creative tools.

All of this is against a fixed user base of over 1 billion daily actives, noted the analysts.

“With AEBITDA margins already in the low 80% range and minimal incremental cost to scale, we see a clear path to sustained revenue growth and strong earnings leverage into 2026.”

AppLovin Corporation (NASDAQ:APP) provides a leading marketing platform powered by AI technology.

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.

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Disclosure: None.