Today, we’ll discuss whether Bumble Be More Valuable Than Match Group? – Today you will get all about dating apps and mostly we will discuss the stock price prediction of Bumble.
Using dating apps, you can meet possible companions. According to studies, the number of people finding their life companions online is growing every year. It is highly likely that you will find your mate online if you’re looking for one.
In the US, there are reportedly close to 27 million users of dating applications on smartphones.
The company that promotes female empowerment may still have room to grow.
The relationship between Match Group (MTCH 0.15%) and Bumble (BMBL -2.86%) is difficult and tense. Whitney Wolfe Herd, the creator, and CEO of Bumble was a founding partner of Match’s popular dating app Tinder together with Sean Rad, Justin Mateen, and Jonathan Badeen.
Wolfe Herd’s status as a co-founder of Tinder was later removed. She then sued Tinder for sexual harassment and discrimination, which was resolved for more than $1 million.
Bumble, a dating service geared toward women, was introduced in 2014 by Wolfe Herd in collaboration with Andrey Andreev, the creator of the Russian dating app Badoo. In contrast, Tinder sued Bumble in 2018 and Bumble responded by suing Tinder, alleging that Wolfe Herd had stolen trade secrets and had violated its patents. Last June, the battle was finally over when both corporations reached an undisclosed settlement.
When Bumble went public in February, many investors questioned if it could surpass Match, which has a sizable number of dating apps compared to Bumble. After going public, however, the market’s enthusiasm for Bumble dimmed, and the stock fell below its IPO price of $43 per share in May.
For the following ten years, though, might Bumble still be a tremendous growth stock? Let’s take a look at its goals for the future to see if it can reach or perhaps top Match Group’s valuation by 2030.
Bumble has been expanding more quickly than Match
Bumble’s revenue increased by 36% in 2019 to $488.9 million, and by 19% in 2020 to $582.2 million. Throughout the pandemic, Bumble’s paid user growth was slower, but it anticipates a 24%–26% increase in income in 2021 when the crisis is over and more people begin dating again.
Analysts anticipate Match’s revenue to climb 22% this year after rising 19% to $2.1 billion in 2019 and 17% to $2.4 billion in 2020.
In comparison to this year’s sales, Bumble and Match are valued at 12 and 15 times, respectively. The proponents of Bumble will probably claim that because it is expanding more quickly than Match, it should trade at a greater price-to-sales ratio.
However, Bumble is far smaller than Match.
The bearish will counter that because Bumble is a much smaller firm, it needs to demonstrate significantly stronger growth in order to support a higher valuation.
In 2020, Bumble’s total paid users (on both Bumble and Badoo) increased by 22% to 2.5 million, and in the first quarter of 2021, they increased by 30% to 2.8 million. Of those users, 1.35 million were hosted by Bumble, and the remaining 1.45 million were provided by Badoo. When compared to Badoo, Bumble’s namesake app makes more than twice as much income on average per user.
In 2020, Match’s paid subscribers (across all of its applications) increased by 12% to 10.9 million, and in the first quarter of 2021, they increased by 12% year over year to 11.1 million.
But how about the following ten years?
According to Allied Industry Research, the worldwide online dating market might expand at a CAGR of 8.3% between 2019 and 2025. But it’s possible that Bumble and Match are expanding more quickly than the overall market.
Bumble might earn $4.4 billion in revenue by 2030 if its yearly revenue increases on average by 25% over the next five years, and then stays steady at a growth rate of 20% over the following five. It could be challenging to maintain that growth trajectory, which would represent a CAGR of 22.5%, but Bumble still has a lot more plans in the works.
The business might monetize Bumble BFF, which is made for platonic friendships, and Bumble Bizz, which offers business contacts, in addition to introducing more services that are beneficial to women. By going beyond simple dating, it may develop into a social network.
Two years ago, Bumble also introduced audio and video calls, and it may continue to develop that platform to compete with Zoom (ZM -0.60%) in the expanding video conferencing industry. Video calls on Tinder have just introduced a year ago. Similar to Match, Bumble might someday buy out other smaller dating apps to expand into new markets and demographics.
Bumble may be worth $50 billion if it achieves $4.4 billion in revenue by 2030 and its stock continues to sell at 12 times sales. But for a very straightforward reason, it will probably continue to be far smaller than Match.
With a CAGR of 11.25% between 2020 and 2030, Match would still bring in close to $7 billion in revenue by the last year, even if it grows only half as quickly as Bumble. Assuming Match likewise trades at 12 times revenue, it would be worth $84 billion. It might potentially be worth $100 billion if it grows just a little bit faster.
Consider more than just market cap comparisons.
Simply put, even if Bumble keeps growing at a significantly higher rate, it is quite improbable that it will be valued more than Match in ten years. However, Bumble doesn’t have to surpass Match in order to be a wise investment.
With those foundations in place, it may be able to create further female-empowering social networking services in the future. Its historical growth demonstrates that there is a solid market for dating applications that let women make the first move. So, for the ensuing ten years, it might still be a good growth stock to purchase.
Should you immediately invest $1,000 in Bumble?
The BMBL stock price started trading at $20.06 on January 10, 2023. The stock’s 50-day and 200-day moving average prices are $22.51 and $26.12, respectively. The company’s debt-to-equity ratio is 0.24, its quick ratio is 3.24, and its current ratio is 3.24. Bumble’s 12-month high is $39.33 and its 12-month low is $15.41. The market capitalization for the stock is $2.60 billion, the price-to-earnings ratio is 125.38, and the beta is 1.80.
The most recent quarterly earnings report from Bumble (NASDAQ: BMBL – Get Rating) was released on November 9th. For the quarter, the firm reported $0.14 in profits per share. Bumble had a net margin of 2.29% and a return on equity of 0.67%. In contrast to experts’ forecasts of $236.89 million, the company’s revenue for the quarter came in at $232.64 million. For the current fiscal year, equity research analysts forecast that Bumble will report 0.23 EPS.
The twenty-one analysts who are currently watching Bumble Inc. (NASDAQ: BMBL – Get Rating) have given the stock a consensus rating of “Moderate Buy,” according to Marketbeat.com. Seven investment analysts have recommended buying the business, while five have rated the stock with a hold rating. Brokers that have reported on the stock in the previous year have an average target price of $27.72 for the stock over the next 12 months.
Is it Time to Buy Bumble (NASDAQ: BMBL)?
Reports on BMBL have been released by numerous brokerages. On Thursday, November 10th, Cowen lowered their target price for Bumble from $38.00 to $33.00 in a research note. On Thursday, November 10th, Evercore ISI decreased their target price for Bumble from $34.00 to $25.00 in a research note. On Monday, October 31st, KeyCorp published a study report that started covering Bumble. They assigned the business a “sector weight” grade. In a research report published on Thursday, November 10th, The Goldman Sachs Group lowered their target price for Bumble from $35.00 to $30.00 and assigned the firm a “buy” rating.
Finally, in a research report published on Thursday, November 10th, the Royal Bank of Canada lowered their target price for Bumble from $33.00 to $23.00 and assigned the company a “outperform” rating.
We hope you read our article, Trading is a complex subject, but we have attempted to explain it clearly. While returns have dipped for Bumble in recent times, we’re delighted to see that revenues are expanding and that the business is reinvesting in its operations. The stock has dropped 40% in the past year, so there may be a chance here if other indicators seem decent as well. As a result, we advise deeper investigation into this stock to learn what the company’s other fundamentals may teach us.
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