These are top 10 stocks traded on the Robinhood UK platform in July
On Thursday, Morgan Stanley (NYSE:MS)’s analysis led to a revised price target for Bumble Inc. (NASDAQ:BMBL), now set at $5.50, down from the previous $6.00, while the firm retained an Equalweight rating on the stock. According to InvestingPro data, this follows a broader trend where three analysts have recently revised their earnings expectations downward. Morgan Stanley cited increased consumer pressure as the reason for the adjustment in their estimates for the number of paying users of the Bumble brand. The stock currently trades at $4.04, having declined over 60% in the past year.
The research firm also reduced its target EBITDA multiple for 2026 from 5.0x to 4.75x, reflecting concerns about the uncertainty of future growth. Bumble Inc., recognized as the second-largest global online dating platform, is currently in the process of expanding internationally. The company’s current EV/EBITDA ratio stands at 5.14x, with last twelve months EBITDA of $267 million. Get deeper insights into Bumble’s valuation metrics and 11 additional key ProTips with InvestingPro.
Despite Bumble’s efforts to innovate and reaccelerate user and revenue growth, particularly in its existing markets, the company’s near-term revenue growth trajectory has been adjusted downward. Morgan Stanley is looking towards the Bumble brand’s product roadmap as a potential major catalyst that could lead to an inflection point in the company’s performance.
The analyst’s comments also noted that Bumble’s EBITDA margin is likely to be capped in the high 20% range over the long term. This is in contrast to competitor Match Group (NASDAQ:MTCH), which Morgan Stanley expects could achieve an EBITDA margin of approximately 35-40%.
In other recent news, Bumble Inc. has reported significant developments that could impact its financial outlook. Fitch Ratings has revised Bumble’s outlook from positive to negative, maintaining its Long-Term Issuer Default Rating at ’BB-.’ This change is attributed to potential execution risks tied to a strategic product refresh, which may lead to revenue declines and margin contraction in fiscal year 2025. Concurrently, Bumble has introduced new features, including ID verification, aiming to enhance user safety and appeal to younger demographics. Founder Whitney Wolfe Herd has returned as CEO, amid a series of executive changes, including the recent departure of the Chief Financial Officer.
In analyst updates, Jefferies has reduced Bumble’s stock price target to $5 from $7.50, maintaining a Hold rating, citing a less optimistic view of the company’s future revenue and EBITDA. Similarly, Stifel has lowered its price target to $6 from $7, also keeping a Hold rating, while Citi adjusted its target to $6.80 from $8, maintaining a Neutral stance. These revisions reflect concerns over Bumble’s strategic challenges and competitive pressures in the online dating market. Despite the adjustments, analysts recognize Bumble’s efforts to enhance user experience, focusing on safety and authenticity. However, the absence of full-year guidance and anticipated margin compression suggest ongoing challenges in achieving a successful turnaround.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.