Seeking Alpha analyst James Bonifer has argued that MTCH is still a ‘buy’, even though Facebook Dating is a looming threat to flagship brands Tinder and Match.com.
His piece starts by outlining the success Match Group has seen under CEO Mandy Ginsberg, saying that growth since the IPO has been “explosive”.
The Match portfolio is highlighted as containing a number of disruptive brands, from early dating giants like Match.com to niche services such as OurTime. The firm also pioneered freemium apps, and acquired innovators such as POF.
Recent acquisition Hinge is described as an intelligent addition, with the brand boasting a 400% increase in downloads over the past 12 months.
Tinder, of course, drives the company forward as the flagship. Places, a new feature, offers enhanced monetisation potential via location data according to Bonifer. Integration with Bitmoji and Spotify are further steps that make Tinder stand out in the sector.
On the threat of Facebook, Bonfier argues that a poor Q2 and historic $100 million drop off in market capitalisation has sent the company stumbling out of the blocks after its dating announcement.
Cambridge Analytica data concerns will also hold the product back, and the social media leader’s entry will be “far less decisive” than the Match stock hit seemed to indicate.
The article concludes: “Trading at 33 times earnings, MTCH is priced fairly compared to FB and relatively cheap compared to cash flow negative lifestyle app developer Snap, Inc. (SNAP). Investors should feel confident in the company’s current valuations and guidance.”
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