To prove that every rule has an exception, a recent analyst condemnation of the dating app Bumble (NASDAQ:BMBL) didn’t hurt it with investors at all. In fact, after Wells Fargo cut its rating on Bumble, shares added fractionally in Monday afternoon’s trading.
Wells Fargo analysts pared back Bumble from Overweight to Equal Weight, noting that the April “bump” in trends thanks to its relaunch was fairly well played out. Worse, there were precious few benefits that could be seen as a result, leaving investors to pick up the pieces.
It actually got worse for Bumble from there, as Wells Fargo looks for any new momentum to prove “likely more challenging” going into the second half of 2024. That prompted Wells Fargo analysts to cut estimates on net adds, dropping back to 120,000 in the third quarter and only 80,000 going into the last three months of 2024. Revenue will likewise take a hit, down 1% in the third quarter and 2% in the fourth quarter.
Recent Ad Campaign Proves a Flop
Things also haven’t gone well for Bumble of late, as a recent ad campaign proved a flop. Bumble declared, on huge billboards, that “A vow of celibacy is not the answer.” That didn’t go over well with potential users. Bumble described it as an “attempt to lean into a community frustrated by modern dating,” and ultimately, “did the opposite” of “bringing joy and humor” as intended. Bumble promptly fell on its sword and sent payoffs to the National Domestic Violence Hotline, among others.
Meanwhile, Bumble discovered that maybe celibacy isn’t such a bad idea, given that one of Bumble’s users was a killer. Reports noted that Tyrese Haspil—ultimately found guilty of killing and dismembering tech CEO Fahim Saleh—was a Bumble user. Haspil was Saleh’s former personal assistant, reports noted, and was “emotionally disturbed” when he killed Saleh. But his presence on Bumble made many doubt this notion.
Is Bumble Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BMBL stock based on nine Buys and five Holds assigned in the past three months, as indicated by the graphic below. After a 46.82% loss in its share price over the past year, the average BMBL price target of $14.21 per share implies 51.74% upside potential.
