The Motley Fool Analyses Bumble’s Upcoming IPO
Stock market analysts at ‘The Motley Fool’ have been taking a look at potential investments in the online dating industry, following last week’s announcement that Bumble had filed for its Initial Public Offering (IPO).
Ryan Henderson compared Match Group with Bumble and speculated which would be a better future buy. Match Group has seen steady growth over the past 12 months, with its valuation growing by approximately two-thirds since the beginning of the pandemic.
Henderson concluded that it was difficult to pick a winner between the two, as online dating overall was a growing area that would benefit both companies. However, he did label Match Group as the “safer bet”.
Meanwhile, Leo Sun published an article listing five reasons why people could benefit the upcoming IPO.
He noted that the possibility for the flagship app to grow into a fully fledged social network for women was promising, and the ownership of Badoo would make it a very interesting prospect for investors.
Bumble still has plenty of room to grow its core product, with plans for dedicated expansions for countries in Europe, Asia and Latin America planned for the near future. The number of premium subscribers increased by 19% in the first nine months of 2020 to 2.4 million, slightly outpacing Tinder’s growth.
Finally, Sun recognised Bumble’s “stable” revenue and “rising” Adjusted EBITDA margins that were slowed down but not drastically reduced by the early COVID-19 outbreak.
The IPO is planned for February, with some reports suggesting that it could come in time for Valentine’s Day. The company is seeking an overall valuation of $6-8 billion, which represents a 20 times increase on last year’s sales.
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