Morgan Stanley Boosts AppLovin Price Target to $365, Citing AI-Driven E-commerce and Gaming Ads

AppLovin Corporation (APP) has received a significant vote of confidence from Morgan Stanley, with the investment bank raising its price target for the company's stock to $365. This new target represents a 12-month forecast and suggests a substantial upside from the current stock price. Morgan Stanley's analysts have highlighted two key AI-driven strategies as key drivers for AppLovin's growth: AI-powered ad targeting and optimization, and AI-driven bidding solutions. These strategies have contributed to AppLovin's strong performance and growth trajectory, particularly in the e-commerce and gaming ads sectors.



AppLovin's expansion into e-commerce advertising has been a strategic move that complements its existing gaming ad revenue. As of 2024, the company's gaming ad revenue is a $3+ billion annual powerhouse, and its e-commerce ad revenue is growing rapidly. The influx of e-commerce advertisers has not disrupted existing CPMs for mobile game advertisers, indicating that AppLovin is effectively monetizing users who weren't responding to game download ads. This balance suggests that AppLovin is well-positioned to accommodate both gaming and e-commerce advertisers, potentially leading to a majority of its revenue coming from e-commerce advertising in the long term. This expansion into e-commerce advertising, combined with its strong gaming ad revenue, positions AppLovin for significant growth in the coming years.



Morgan Stanley's new price target for AppLovin reflects the company's growth potential in both e-commerce and gaming ads. The analyst firm has raised its price target for AppLovin's stock to $360, indicating a 12-month price forecast that suggests a significant upside from the current stock price. This increase in the price target is likely driven by Morgan Stanley's positive outlook on AppLovin's expansion into e-commerce advertising and its continued dominance in gaming ads. The analyst firm's confidence in AppLovin's growth prospects is evident in its decision to raise the price target, signaling that they believe the company's stock is undervalued at its current price.

In conclusion, Morgan Stanley's new price target for AppLovin Corporation (APP) highlights the company's strong growth potential in the e-commerce and gaming ads sectors. With AI-driven strategies such as AI-powered ad targeting and optimization, and AI-driven bidding solutions, AppLovin is well-positioned to capitalize on the growing demand for targeted and effective advertising solutions. As the company continues to expand its presence in both e-commerce and gaming ads, investors can expect significant growth opportunities in the coming years.