On Friday, JMP Securities maintained a positive stance on Grindr (NYSE:GRND), currently trading at $16.73 with a market capitalization of $2.95 billion, reiterating its Market Outperform rating with a steady price target of $21.00. The firm’s analysts highlighted Grindr’s updated 2024 guidance, which was released alongside the company’s plans to redeem outstanding warrants. This guidance indicates that Grindr is expected to surpass expectations for both revenue and earnings when it reports its final fourth-quarter numbers for 2024. According to InvestingPro data, analysts anticipate continued sales growth in the current year.
Grindr’s stock performance has been notable, with an approximately 89% increase over the past year, significantly outperforming the Russell 3000 and the S&P 500 indices, which have seen rises of about 25% and 26%, respectively. Despite a slight year-over-year and quarter-over-quarter decline, the monthly active user trends for Grindr remain strong compared to the broader industry.
The analysts at JMP Securities believe that market expectations have been adjusted to account for Grindr’s updated full-year outlook. Moving forward, they anticipate further details on Grindr’s strategies for monetization and product development, building upon its impressive 74.36% gross profit margin. Additionally, they are looking for commentary on Grindr’s international business and insights into the company’s growth and profitability projections for 2025 during the upcoming earnings call, scheduled for March 10, 2025.
Grindr’s valuation, according to JMP Securities, is based on an enterprise value to estimated 2026 EBITDA multiple of approximately 22 times. The firm’s analysts have expressed confidence in the company’s potential, as reflected in their maintained Market Outperform rating and $21.00 price target. InvestingPro analysis suggests the stock is currently trading slightly above its Fair Value, with 12 additional exclusive insights available to subscribers. Investors are now awaiting the final fourth-quarter results and the forthcoming earnings call for further information on the company’s performance and strategic direction.
In other recent news, Grindr Inc. has announced an optimistic revenue outlook for 2024, expecting to surpass previous projections with a potential increase of 32%-33% YoY. This positive revision is due to the strong performance of its direct ad sales business and the sustained vigor in direct revenue from subscriptions and add-ons. In addition, Grindr has plans to redeem outstanding public and private placement warrants at a redemption price of $0.10 per warrant.
Goldman Sachs has initiated coverage on Grindr, issuing a Buy rating and setting a 12-month price target of $20.00 for the company’s shares. This was based on Grindr’s impressive revenue growth, market capitalization, and strong operational execution. The firm also sees a potential for a 20% or higher compound annual growth rate in revenue from 2024 to 2029.
Grindr is also set to launch new features aimed at enhancing user experience. These include AI-driven personalization tools, expansion of travel features, and new Gayborhood products and services with a focus on health and wellness. The actual performance of these new products may vary once they are launched and tested in the market. These are among the recent developments that underline Grindr’s strong financial performance and optimistic future outlook.
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