It’s up about 7% after hours on this news.
Drew
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Congrats, all $APP holders. $HOOD was added today as well. $APP will be the 63rd largest stock in the index and $HOOD will be the 121st.
Long both.
Luffy
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I asked this question to GROK: $APP Considering that it was announced after the market closed on September 5th 2025 that $APP would be added to the S&P500 index on Monday September 22nd, 2025, approximately how many shares of $APP will need to be added by ETFs that track the S&P500 index prior to that date?
GROK’s Answer: Approximately 18.7 million shares.AppLovin’s market cap is $169 billion as of the September 4, 2025 close (stock price: $499.97; ~338 million shares outstanding). The S&P 500’s total market cap is $54.76 trillion, giving AppLovin a ~0.309% index weight.SPY, with ~1.01 billion shares outstanding and $655.75 billion in AUM, tracks the S&P 500 proportionally. To match this weight, SPY must hold ~$2.03 billion in AppLovin stock, or about 4.06 million shares at the $499.97 price. However, SPY represents ~12% of total S&P 500-tracking AUM (estimated at $5.5 trillion industry-wide). Thus, total passive purchases are ~33.9 million shares, with SPY accounting for ~18.7 million.This estimate assumes full replication by trackers (common for S&P 500 ETFs) and excludes active funds or front-running, which could add 10-20% more buying pressure. Historical inclusions (e.g., Tesla in 2020) saw similar scaled purchases based on market cap weights.
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@twillo Nice point there, another way to think about this is that S&P indexes and trackers will have to buy twice as much in dollar amount of AppLovin than Robinhood because it is market cap weighted. I also just learned that AppLovin is the 2nd largest company to get added to the S&P ever! The top three are,
- Tesla at ~600M
- AppLovin at ~169B
- Uber at ~127B
This is also keeping in mind that AppLovin themselves have been purchasing significant shares and taking them off the market. Combining this with a new product being launched more broadly in Q4, this could get really interesting heading into the end of the year.
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Interesting commentary from Eddie Jones about APP team speaking yesterday. Sounds very bullish as APP launches e-commerce business.
more” / XLink to the presentation:
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I have owned app for a while. It’s 52 week range is 105 to 587. It is now at 581. It’s a very volatile stock, and I think now is not the time to enter it. I would not be at all surprised to see it go to 350, which would be a good entry point.
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Flying,
This is counter to the boards philosophy. We don’t focus on timing, or entry point(Close to off Topic). We are laser focused on finding the best growth companies. Half of my best investments were at their all time high including APP in the 70s when I first bought it. Growth stocks with a rapid growth in price are inherently volatile, if we didn’t invest in stocks because of volatility we would miss so many winners.
You joined the board after Saul stopped posting, and missed his frequent wisdom. But I strongly suggest you go read his knowledgebase. Its full of wisdom like the quote above. I go read his knowledgebase about once a quarter to look for new insights into growth invest.
Drew
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Ok, my apologies. I won’t make posts like that anymore.
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Thanks, @drew1618t.
The simplest rule of thumb for the board is anything about the company (news, overall performance, quarterly results, underlying metrics, business model, management, etc) is entirely fair game. Almost anything about the stock (price, volume, options pricing, entry points, valuation, etc) is out of bounds.
The power of the crowdsourcing here has always been about identifying and breaking down companies. What anyone decides to do with the stock is strictly in the eye of the beholder. The one slight deviance has traditionally been buy/sell or allocation questions in conjunction with a monthly recap. Other than that, the focus of Saul’s has always been the business rather than the stock.
Hope that helps.
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APP has announced that they have gone live with international customers three weeks ahead of schedule (it had been planned for 10/1). This is a quote from APP’s ceo at the recent Goldman Sachs Communicopia conférence
I did want to touch on one thing too that I wanted to state on this before we wrap, because I don’t want to create an IR problem for us as we go into a closed window. We had said we’re launching our self-serve ads platform, 10/1, and we’re opening up international to our web customers, 10/1. We’re pacing well against the 10/1 goal, but we did just open up international to our customers a couple of days ago. If you start looking on Twitter or talk to advertisers, you may see that they’re starting to see good performance outside of just the States. We’ve been testing this product broadly outside of the States with some pilot customers inside the pilot internationally. The tests are great. Results have been phenomenal. We’re ahead of schedule on that. That’s already in market.
I just want to make sure investors realize that that’s three weeks ahead of schedule.
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I thought that at the end that Saul was starting to go back to valuation. I know for a while, he discounted it totally, but after 2022, I remember him going back to it. I know that Bear uses valuation. There are people who have formula’s that value stocks, and someone else mentioned he uses (EV/Ebitda)*Ebitda growth in deciding to pick a stock. I’ll post whatever you want, but I am just stating my sense is valuation is used. The other four you mentioned I agree, those are out of bounds. I agree if a stock has gone up 8 fold, but you expect it to go up more, by all means buy the stock. I am talking about cases where the stock is valued so highly, that you think it will go down.
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So, your suggestion of an exit or trim would not have be criticized if it had been accompanied by an analysis confirming buying euphoria had driven the stock price up, and the relative value of the investment had fallen below a rational level based on any one of a number of metrics measuring company value.
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I think the subtle difference here is between valuation and timing a stock.
Generally it’s fine on this board to talk valuation if we are looking at a P/S or P/E ratio. Comparing a given company to other companies in the same industry is fair game. Even mentioning a strategy like a trimming a stock because it’s been on a big run is okay.
The board does not typically guess a specific stock price the company is heading too though. For example, you mentioned you wouldn’t be surprised to see the stock reach 350. There were not specific business reasons for the potential downside, other than the stock has a wide price range over 52 weeks. The stock has been a tremendous run specifically because the business has been over-performing, so it makes sense the price was much lower one year ago. The size of the opportunity for AppLovin is much bigger now with their new product launching.
Generally it would be fine to say something like I see significant downside for APP because of reasons X, Y & Z. It would also be fine to say I think the valuation of APP is too high because the P/S ratio is X.
Basically conversations on valuation are completely fine, it’s just specific price predictions and timing entries is a very different strategy than the one Saul discusses.
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I understand. That makes a lot of sense.
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Sorry, @flyingelephant1. I wasn’t entirely clear.
This is along the lines of what I was thinking. I meant valuation more in relation to all those other off-topic subjects I listed, especially when those are the only items addressed in a post. I was also thinking of instances where “cheap” valuation stocks are sometimes brought to the board that clearly don’t fall in the growth investing category. As old poster TMFTinker used to say quite often “cheap is cheap for a reason”, and many of those companies would quickly fall by the wayside after even a little scrutiny.
The main point is the focus of this board has always been about discussing the merits of a company over the relative attractiveness of a stock.
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