AppLovin lack of 8K implies informal SEC inquiry, says BofA

After Bloomberg reported yesterday that the SEC has been probing the data collection practices of AppLovin (APP), BofA noted that neither the SEC nor AppLovin have given details of the reported probe. Given that formal investigations and Wells Notices, if material, are usually disclosed by companies, and since no 8K was filed by AppLovin, it would imply that the SEC’s inquiry may still be “an informal, information gathering exercise,” possibly triggered by tips from short sellers, a whistleblower, press articles, or even routine monitoring, according to the analyst. The firm reiterates its Buy rating and $860 price target adding that it views the pullback as “a particularly attractive buying opportunity based on what we know” today and that it expects the Q3 call to be “an important catalyst.”