AppLovin’s (APP) CEO and Chairperson Arash Adam Foroughi, recently sold shares worth over $41.6 million. This transaction has grabbed investors’ attention, having raised concerns about the company’s future. APP stock has declined about 3% in the pre-market trading session.
APP is a technology company that provides mobile app developers with marketing, monetization, and analytics solutions.
Details of the Insider Sale
According to a recent SEC filing, Foroughi sold 99,143 shares, which is a substantial portion of his holdings in AppLovin. The transactions took place on February 21 and February 24, with shares sold at prices ranging from $395.99 to $441.12 per share.
It is worth noting that even after these Informative Sell transactions, Foroughi directly owns about 2.87 million AppLovin shares worth $1.18 billion. In addition, he indirectly owns 5.36 million shares, including those held by trusts for the benefit of his children.
The reasons for such large transactions can vary and may not necessarily mean the insider lacks confidence in the company’s future. Investors should note that these sales can be driven by personal financial planning, diversifying assets, or other reasons unrelated to the company.
Insider Sale Follows AppLovin’s Strong Q4 Results
It is worth noting that the CEO sold AppLovin stock after the company released its robust Q4 earnings report on February 12. Since the earnings release, APP stock has gained about 8%.
In the reported quarter, the company saw a 44% year-over-year increase in revenue, and its adjusted EBITDA rose by 78%.
Looking forward, APP plans to grow its e-commerce category and introduce automated tools to improve accessibility. The company is set to sell off its Apps business by Q225 to focus entirely on its advertising platform. Importantly, for the first quarter of 2025, AppLovin expects the Advertising business to generate between $1.03 billion and $1.05 billion in revenue.
Insiders Sentiment for APP Stock Is Currently Bearish
In addition to the CEO, some more corporate insiders at AppLovin have decreased their stake in the company. Overall, TipRanks’ Insider Trading Activity Tool shows that insider confidence in APP stock is currently Very Negative. Corporate insiders have sold shares worth $3.6 billion over the last three months.
Investors could keep close track of these notable insider activities, as they reflect the perceptions of key insiders about the company’s prospects. Interestingly, TipRanks offers daily insider transactions as well as a list of top corporate insiders. It also provides a list of hot stocks that boast either a Very Positive or Positive insider confidence signal.
Is APP a Buy or Sell?
Turning to Wall Street, APP stock has a Strong Buy consensus rating based on 14 Buys and four Holds assigned in the last three months. At $539.88, the average AppLovin price target implies a 31.53% upside potential.
