We recently published a list of 11 Best Guru Stocks to Buy According to Wall Street Analysts. In this article, we are going to take a look at where AppLovin Corporation (NASDAQ:APP) stands against other Guru stocks to invest in.
Wall Street seems to be breathing a little easier after the initial panic over President Trump’s tariffs earlier this month, but the rollercoaster is not over just yet. All three major indexes closed last week in the red, with the Dow and NASDAQ both dipping over 2%, and the broader market down more than 1%. Even though markets remain closed on April 18 for Good Friday, the general consensus is that the worst of the trade war headlines might be dying down.
Marko Papic, chief strategist of geomacro strategy at BCA Research, remains cautiously optimistic, noting that while the idea of President Trump striking 90 trade deals in 90 days sounds ambitious, they will likely be small, symbolic wins that still help calm markets. That said, volatility is expected to continue, and Papic predicts the broader market could dip again before bouncing back, potentially giving investors a buying opportunity.
Investors are deep in earnings season right now, and some of Wall Street’s biggest banks have reported solid first-quarter results. A big part of their success came from their trading desks, which cashed in on the recent market volatility, especially in equities. However, despite strong numbers on paper, bank CEOs remain cautious and are hesitant to make big moves right now because of the market uncertainty. The US dollar also just had its worst weekly performance since 2022. Meanwhile, investors are playing it safe and rapidly buying bonds, which pushed the 10-year Treasury yield down to around 4.28%.
While some investors are seeing the current market dip as a buying opportunity, Daniel Von Ahlen from GlobalData TS Lombard says otherwise. He believes the risks of a recession are being seriously underestimated. Even though Trump’s recent tariff halt gave markets a bit of a boost, Ahlen thinks that bounce will not last. In his view, this is not the time to scoop up stocks on the cheap, he is actually advising people to sell into rallies and avoid the usual buy-the-dip strategy. Ahlen suggests getting a bit more cautious and selective. Instead of jumping into the whole market, he recommends focusing on defensive sectors, like utilities, consumer staples, and healthcare, that tend to hold up better in downturns.
The market uncertainty is reflected in ETFs as well, which are often considered wiser investment options due to active management strategies and lower risk compared to individual investing. For example, the Guru ETF is down 8.30% year-to-date as of April 18. However, over the last 12 months, the fund has posted share price returns of 13.38%. Similarly, five-year share returns stand at an impressive 51.57%. GURU gives retail investors a way to tap into the top stock picks of major hedge funds at a relatively low 0.75% expense ratio. It offers a more affordable and flexible way to try and beat the broader market using expert insights. So, let’s take a look at the best Guru stocks to buy.
A close-up of a mobile device, showing an advertiser reaching out to a consumer via a software-based platform.
Our Methodology
For this article, we looked up the GURU ETF, which had 82 holdings as of April 18. Next, we manually searched for the average upside potential of each stock and selected 11 stocks with the highest values. The list below is ranked in ascending order of the upside potential as of April 18. We have also mentioned the hedge fund sentiment as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 95
Average Upside Potential: 95.66%
AppLovin Corporation (NASDAQ:APP) is a California-based tech company that allows advertisers to grow and monetize their content through software tools. The company connects advertisers with app publishers, runs real-time auctions to get the best ad placements, and provides data and insights to help improve marketing strategies. It also supports connected TV advertising and distributes streaming content. It is one of the best Guru stocks to look out for.
On April 11, UBS analyst Chris Kuntarich assigned a Buy rating to AppLovin Corporation (NASDAQ:APP) but reduced the price target to $450 from $630. UBS is still confident in the company’s future, even after a short report raised some concerns and made e-commerce advertisers a bit more cautious. While first-quarter revenue might fall short of expectations, feedback on the company’s performance has been positive. UBS believes AppLovin’s advertising business could grow by more than 40% annually over the next few years.
AppLovin Corporation (NASDAQ:APP) recorded $1.37 billion in Q4 revenue, a 44% jump from last year, and $4.71 billion for the full year, up 43%. Most of that growth came from advertising, which surged 73%, while app revenue dipped slightly. Net income climbed a whopping 248% in Q4 and 343% for the year. Looking ahead, AppLovin expects Q1 2025 revenue to reach up to $1.385 billion. It also repurchased 25.7 million shares in 2024, ending the year with 340 million shares outstanding.
According to Insider Monkey’s fourth quarter database, 95 hedge funds were bullish on AppLovin Corporation (NASDAQ:APP), up from 51 funds in the prior quarter. Rajiv Jain’s GQG Partners was the largest stakeholder of the company, with 8.4 million shares worth $2.7 billion.
Overall, APP ranks 8th among the 11 Best Guru Stocks to Buy According to Wall Street Analysts. While we acknowledge the potential of APP as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than APP but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
