Strong Q3 Performance and Reassuring Valuation Metrics for AppLovin

2 months ago

Host

"Now since App has been such a hot stock in recent months, we decided we'd do a update on our reverse DCF. Now of course it's not the value it was a few months ago, but let's go ahead and take a look and see what's baked into the current valuation. Trailing 12 month free cash flow per share of $9 and 77 cents compared to $9 and 14 cents last quarter. Free cash flow per share growth of 30% for five years, a terminal growth rate of 6% with a discount rate of, 10% gets us to a fair value of around $680, which was the pre-market share price when we recorded this video on November 6th, 2025."

The speaker provides detailed Q3 metrics and a reverse DCF valuation for AppLovin, noting significant free cash flow growth and a fair value estimate that closely matches its pre-market share price. This commentary underscores the company's strong operational performance and evolving valuation, offering reassurance to investors regarding its current price level.

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