AppLovin price target raised to $620 from $545 at Wedbush

Wedbush raised the firm’s price target on AppLovin (APP) to $620 from $545 and keeps an Outperform rating on the shares following the Q4 report. The Western mobile game market generates well over $100B in annual revenue, with around 30% of revenues spent by the developers on user acquisition, the analyst tells investors in a research note. The firm says this $30B in annual spending is growing by around 7% per year, shifting primarily from socials before 2020 to roughly 50% in mobile games today. AppLovin is “slowly gaining a huge share” of the $15B advertising spending inside mobile games, driving its recent “outsized results,” contends Wedbush. The firm says that much like mobile games, AppLovin’s ad technology can help e-commerce partners identify likely purchasers of their products. It suspects mobile advertising of products and services will grow from the current $1B-$2B annual level to over $10B in the next three years.