It’s a great day for dating service Bumble (NASDAQ:BMBL), who’s up nearly 3% in the closing minutes of Friday’s trading session. It landed an upgrade from analysts that sent its stock upward, and it’s also got some noteworthy plans for the future that might make it all the more attractive.
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Loop Capital analysts sent Bumble on its way up by upgrading the stock from Hold to Buy, though it left the price target at $18 per share. Those analysts also noted that $18 was a “low bar,” and this was the first time that they’d bumped Bumble up to a Buy rating since they started covering it nearly three years ago. Further, the analysts pointed to Bumble’s cash hoard and its free cash flow, along with its solid use of interest rate swaps, as reasons to stick with the stock.
Certainly, skeptics are still on hand, and have a worthwhile case. Concerns about Bumble’s Total Addressable Market (TAM) are valid, and the overall macro economy could be an issue. Clearly, a recession will not stop many from looking for love, but some of Bumble’s customers may well employ other methods instead. That’s why Bumble has some noteworthy plans waiting in the wings. Particularly interesting is how Bumble looks to put AI tools to work in better connecting singles. Bumble won’t be going into AI girlfriends/boyfriends as some have done, but instead, AI will serve as a kind of “digital matchmaker” with a few relevant safety features included.
Is Bumble a Good Investment?
Analysts are largely behind Bumble. Its stock is rated a Strong Buy by analyst consensus, with 10 Buy ratings and three Holds to support the consensus. Further, Bumble stock offers investors 51.21% upside potential, thanks to an average price target of $22.56.
