Proof in Performance: Empirical Validation of SIRRIPA as a Groundbreaking Equity Return Metric -AppLovin's +74% Gain in Six Weeks After Identification as Undervalued (August 20, 2025)

Preuve par la performance: Validation empirique du SIRRIPA en tant que nouvel indicateur révolutionnaire de rendement boursier — Hausse de 74 % en six semaines de l'action AppLovin après son identification comme sous-évaluée (20 août 2025)

Rainsy Sam
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Rainsy Sam: International Management School Geneva (IMSG)

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Abstract: This article provides empirical validation of the Stock Internal Rate of Return Including Price Appreciation (SIRRIPA) as an advanced and predictive valuation metric derived from the Potential Payback Period (PPP) framework. By integrating earnings growth, interest rates, and risk-three key variables absent from traditional ratios such as the P/E and PEG-SIRRIPA measures a stock's total intrinsic return, combining earning power and price appreciation potential into a single annualized indicator. The model's accuracy is demonstrated through the case of AppLovin (APP), identified on August 20, 2025, as undervalued despite a seemingly high P/E ratio of 56.8. Over the following six weeks, AppLovin's share price increased by 74.15%, validating the SIRRIPA-based forecast. As of September 30, 2025, AppLovin's SIRRIPA remains 6.70%, exceeding the risk-free rate of 4.15%, confirming continued intrinsic upside.These results demonstrate that SIRRIPA provides a superior, forward-looking framework for evaluating high-growth equities, offering investors a more accurate measure of equilibrium between profitability, valuation, and market price.

Keywords: Potential Payback Period (PPP); SIRRIPA; Equity Valuation; Intrinsic Return; AppLovin; High-Growth Stocks; Potential Payback Period (PPP) SIRRIPA Equity Valuation Intrinsic Return AppLovin High-Growth Stocks (search for similar items in EconPapers)
Date: 2025-10-01
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