On Thursday, Evercore ISI made an adjustment to Match Group's (NASDAQ:MTCH) financial outlook, reducing the price target to $35 from the previous $37 while retaining an Outperform rating on the company's stock. Currently trading at $30.58, Match Group appears undervalued according to InvestingPro analysis, with analyst targets ranging from $30 to $53. The revision followed Match Group's first investor day, which took place on December 11, where the company presented varied projections for its various segments.
The analyst noted that Match Group's investor day revealed a subdued forecast for Tinder, which seemed to overshadow the positive outlooks for other segments such as Hinge, MG Asia, and E&E. Despite this, the firm acknowledged Match Group's commitment to innovation, highlighting the introduction of compelling artificial intelligence initiatives across the company's portfolio. Moreover, Match Group has launched several initiatives aimed at enhancing operational efficiency and optimizing capital allocation, which are viewed as shareholder-friendly.
Match Group also shared some positive metrics regarding the Tinder brand, including improvements in match coverage and the number of matches per week. The introduction of around 25 new features in 2025, focusing on platform integrity, AI, and social elements, is seen as promising. The company maintains steady growth with a 6.12% revenue increase over the last twelve months. However, the guidance provided for revenue and the accompanying commentary suggest that a recovery in Tinder's monthly active users (MAU) may take several years.
Following a reassessment of estimates for adjusted operating income (AOI) in 2025, 2026, and 2027, which showed a decrease of 7%, 7%, and 6% respectively, Evercore ISI decided to lower the price target. Despite the challenges, the firm maintains an Outperform rating on Match Group's stock, considering the value compelling, especially given the company's target of achieving $5 of free cash flow per share by 2027.
Trading at a P/E ratio of 13.07, Match Group shows attractive valuation metrics relative to its growth potential. Access the complete Match Group analysis and Pro Research Report, along with 1,400+ other detailed company reports, exclusively on InvestingPro.
In other recent news, Match Group, the online dating company, has seen adjustments in its financial outlook following recent developments. Truist Securities reduced its price target for Match Group to $34, maintaining a Hold rating. The company's commitment to AI-powered growth and share buybacks was highlighted during their recent Investor Day. However, Truist Securities has adopted a cautious stance due to an extended timeline for Tinder's recovery.
Stifel also adjusted its stock price target for Match Group to $36.00 due to an unexpected $15 million foreign exchange headwind, despite maintaining a Hold rating. RBC (TSX:RY) Capital maintained its Outperform rating on Match Group with a steady price target of $35.00, noting potential long-term growth rebound and margin expansion.
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