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Analysts told investors that it’s the first time the firm has had a Buy rating on Bumble since it launched coverage two and a half years ago. They feel the current Bumble share price reflects a low bar.
“We think the stock is de-risked trading at its 52-week low and down over 30% YTD,” the analysts wrote. “We think the company’s cash balance, effective use of interest rate swaps, and FCF generation protect the balance sheet. On our 2024 estimates, the current stock price reflects an 11% FCF yield.”
They note that investor sentiment is extremely bearish on the stock, and it is clear to them that “investors are skeptical of the TAM and longer-term growth trajectory of the online dating business.”
However, Loop Capital believes they are overly discounting BMBL’s “superior historical growth and growth prospects.”
