Cash overflow x for swipe12/1/2023 ![]() That leaves firms with the challenge of convincing investors of that future. "There's all kinds of reason why a bear would say that stock isn't worth what Fitzgerald says it is, but when I look at the fundamentals of the business, they're still fairly resilient," he said. He described activity as something that ebbs and flows, but is mostly consistent. He noted that Match and Bumble both began tumbling from their peaks shortly after the Fed began raising interest rates to fight inflation - a move that hammered the tech sector broadly in 2022 as investors braced for tighter financial conditions.īut even with the trouble that's pressured stocks over the past year, engagement patterns on major dating apps haven't really fallen off, Fitzgerald said. Investors are not quite on the same page, according to Wells Fargo analyst Brian Fitzgerald. He also argues against the notion that money spent on online dating app is discretionary. Those trends are hard to reverse even as the economy tips into gloomier times. Online dating is the most popular way that new couples meet, per a 2019 study by a Stanford sociologist, with the industry set to grow 7.6% over the next seven years, according to an analysis from Grand View Research. Schindler also doesn't foresee a recession in online dating, despite fears that a downturn could cause consumers to pull back on discretionary spending, such as, say, their Tinder subscriptions. The forward valuation to cash flow ratios for both companies suggest that they're relatively undervalued and that double-digit growth is realistic for both firms. That's largely because both stocks are "extraordinarily cheap" when considering their valuation to cash flow, Schindler said, a measure that can indicate if a stock is overvalued. For Bumble, he says the stock has 74% upside, predicting shares to hit $29. Still, no analyst following either stock has assigned a "sell" rating, according to data from MarketBeat, with experts citing strong growth prospects and the popularity of online dating as key factors that could carry the shares higher, even as the economy flirts with a potential downturn.īank of America analyst Nat Schindler told Insider he sees 66% upside for Match and has a price target for the dating app giant of $70 a share. Match Group, the parent of Tinder and Hinge, has shed 75% of its value since hitting a record share price of $169.53, though the stock has rebounded 20% over the last month to $42 a share.īumble, meanwhile, has tumbled 77% from its initial public offering of $75.46, and has only barely recovered, inching 2% higher the past month to $16.63 a share. The optimism seems hard to justify to investors who remain skeptical of dating apps after witnessing key names plunge from their all-time-highs in late 2021. Online dating apps could be on the verge of another boom, according to Wall Street experts, who have turned more bullish on the likes of Match Group and Bumble despite their stock prices cratering in recent years.
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