Match Group (NASDAQ:MTCH) was added as one of JPMorgan's top picks, analysts at the firm revealed in a note to clients on Wednesday.
MTCH shares are up 3.5% premarket.
The analysts, who raised the MTCH price target to $60 from $55, maintaining an Overweight rating on the stock, also stated the firm has added Match to the JPMorgan U.S. Equity Analyst Focus List as a value idea.
It's "time to swipe right" on Match, the analysts wrote. "MTCH has gone from one of the most liked Internet SMIDs pre-pandemic to trading at a slight discount to the S&P 500, with current investor sentiment as negative as we can remember going back to MTCH's IPO in 2015."
However, JPMorgan now thinks "the pendulum has swung too far, and investors are too pessimistic on both the online dating market opportunity & durability of the Tinder turnaround." They see a number of potential positive catalysts in the coming months.
The decision to turn more positive on MTCH shares now is driven by JPM's work suggesting online dating is still a DD percent growth sector, Tinder returning to DD percent growth in 3Q, increasing evidence that Tinder's turnaround is durable, and Tinder moving past its peak payer net add losses in 2Q.