Applovin (APP) was my first write up in the “Who Am I?” series in June 2024 (at $70). I also used APP to frame the upside potential in Entravision (EVC) “Pattern Recognition” write up in March 2026 (at $3).Today APP is trading at about $300, post suffering a c.60% drawn down from its December 2025 peak. It has de-rated from a nosebleed 40-50x FCF to a respectable 14x.My “pattern recognition” alarm bells are ringing again… the risk reward and set up in Applovin at $300 today reminds me of 2 years ago when it was trading at $70. Below is what I wrote up in my June 2024 Applovin “Who Am I”:“I’m a large cap, dominant global leader in my niche, and am taking shareMy closest comp is levered, unprofitable and undergoing a deep restructuringI have a good co and bad co… so group numbers hide the shifts under the surfaceBad-Co was in decline but has stabilised and is under strategic reviewGood-Co is c.90% of profits, growing 90% and is and has 70%+ EBITDA marginsAI is driving better outcomes for my customers and is fuelling growth I am about to start leveraging this capability into larger adjacent marketsI’ve guided to sustainable mid-term organic revenue growth of 20-30% in the good-coBut the sellside doesnt bake this it into their forecastsI’m capital light, c.70% of EBITDA converts to FCF, which I use to buyback stockSo, my FCF / share should grow at a c.30% CAGRYet I trade on just c.11x FCF / share in 2025I’m a growth stock on a value multipleWho am I? I’m Applovin (APP)”Fast forward to today - what looks similar?1) ValuationAt $300 the 2027 FCF per share multiple is about 14x, assuming net cash & all FCF between today and end of 2027 is recycled to buybacks at today’s price. Clearly, this is a premium to the 11x multiple I had pencilled in 2 years ago (which proved to wildly too conservative), but at the time Applovin was a good-co/bad-co, with c.15% of earnings coming from a low quality, shrinking, low margin Apps divison, which has since been sold. Arguably the market was valuing the advertising/software division at 14x and the Apps division at 4x. I view the valuation for Applovin today as similar to 2 years ago, post adjusting for the Apps division disposal.2) Sceptism on delivering medium term growth targets In 2024, the CEO framed the (advertising) business as a “20-30% long-term grower”. At the time there was a lot of sceptism about growth being sustainable at that level, in the context of lapping Axon 2.0, and having a dominant share of wallet within a mature gaming category. Short interest was double digit, albeit the short reports didn’t surface until 2025. APP subsequently crushed expectations, delivered the following organic growth numbers from Q4 2024 to Q2 2026: 66%, 76%, 71%, 77%, 68%, 66%, 59%, 53%. There’s no escaping that the growth is decelerating and likely will continue to do. However, on the last earnings the CEO said “Over the longer term, as we continue improving gaming and expanding consumer, we believe this business can compound at roughly 30% annually.” Given that:the stock is deeply oversold and in a 60% drawdown the forward multiple has been crushed from 40-50x to 14xconsensus pencils in growth of 27% in 2027, 24% in 2028 and 8% in 2029…. increasingly undershooting the 30% medium term growth algo recently communicated by the CEOmultiple sell side analysts downgraded their recommendations and slashed their price targetsI’d argue that the market is again deeply sceptical of APP hitting its medium term growth guidance. The last time the valuation was this low and sceptism was this high was in summer 2024. Applovin has the most glowing financial metrics I can find of any large cap globally. On a TTM basis: 78% EBIT margin, 66% FCF margin, ROIC 133%, ROE 204%, c.55% revenue growth. The only other company that comes close is Nvidia (higher growth, but more capital intensive & lower profitability). The market clearly has doubts the sustainabilty of growth and/or margins. At 14x 2027 FCF per share, I think the risk reward is very attractive. I view the stock as discounting c10% FCF per share growth beyond next year, and at today’s multiple buybacks alone underwrite a 5-6% EPS and FCF per share CAGR. If the growth sustainbility perception changes, perhaps as consumer/e-comm traction becomes more visible, there is substantial re-rating potential. If growth persists but the multiple doesn’t re-rate, shareholders could still do very well, similar to Priceline/Booking (BKNG) during the 2010s, when the multiple mostly ossiclated between 15-20x. Over that decade the stock was a 10 bagger driven predominately by the 25% EPS CAGR. Note: the author is invested in securities of Applovin (APP). Do your own due diligence, nothing written is investment advice.Uzo Thanks for reading Uzo Capital! Subscribe for free to receive new posts and support my work.