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On Monday, BofA Securities analyst Curtis Nagle adjusted the price target for Match Group (NASDAQ:MTCH) shares, reducing it to $33.00 from the previous $36.00, while retaining a Neutral rating on the stock. Currently trading at $28.69, InvestingPro analysis suggests the stock is undervalued, with additional insights available in the comprehensive Pro Research Report. The revision comes ahead of Match Group’s earnings report, scheduled to be released before the market opens on May 8, followed by a conference call at 8:30 am ET.
Nagle noted a minor increase in the first-quarter estimates for Match Group due to favorable foreign exchange (FX) conditions and a slight uptick in Tinder’s performance, as indicated by Sensor Tower data. The company maintains strong fundamentals with a healthy gross profit margin of 71.58% and generated $3.48 billion in revenue over the last twelve months. With over half of the company’s revenue generated internationally, the analyst anticipates that the FX could shift from a 2 percentage point drag to a slight boost for the year, based on current exchange rates.
Despite the positive FX impact, Nagle expressed concerns regarding the potential effects of increasing macroeconomic uncertainty, including tariff issues and recession risks. These factors could negatively influence the current trends of soft payer growth and a la carte sales, potentially neutralizing the gains from FX. InvestingPro data shows the company maintains strong liquidity with a current ratio of 2.54, while management has been actively buying back shares - one of several exclusive ProTips available to subscribers.
The updated first-quarter revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization) estimates were marginally raised by 0.7% to $835 million and $269 million, respectively. These figures are slightly above the consensus estimates of $827 million in revenue and $264 million in EBITDA. However, the full-year 2025 estimates remain unchanged at $3.46 billion in revenue and $1.26 billion in EBITDA, aligning with the Street’s projections.
For the year 2026, Nagle has revised revenue and EBITDA estimates downward by 1.3% and 3.1%, respectively, due to anticipated lower payer growth. These revised estimates stand 0.8% and 1.3% below the Street’s expectations. The company currently trades at a P/E ratio of 13.6x and generated $985 million in EBITDA over the last twelve months. Consequently, the price objective for Match Group stock has been lowered, with the valuation still pegged at 8 times the projected 2026 enterprise value to EBITDA.
In other recent news, Match Group has been at the center of several noteworthy developments. Moody’s Ratings upgraded the senior unsecured note rating of Match Group Holdings II, LLC to Ba2 from Ba3, acknowledging the company’s reduced secured debt following the repayment of a $425 million term loan. This move has decreased the company’s pro forma leverage to approximately 3.4x. Meanwhile, Anson Funds, an activist investor, is pushing for a boardroom shake-up at Match Group, nominating three new directors amid concerns over the company’s governance and long-term performance.
Additionally, Match Group has announced changes in its leadership, promoting Hesam Hosseini to Chief Operating Officer effective April 1, 2025, while President Gary Swidler plans to step down in July 2025. In a separate development, Match Group has been involved in an antitrust case against Apple (NASDAQ:AAPL) in India, where it unsuccessfully sought access to certain commercially sensitive information. Apple’s concerns about potential harm from disclosing this information led the Competition Commission of India to rule in its favor. These recent events highlight ongoing strategic and operational shifts within Match Group as it navigates complex industry challenges.
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