Morgan Stanley analyst Nathan Feather has maintained their neutral stance on BMBL stock, giving a Hold rating yesterday.
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Nathan Feather has given his Hold rating due to a combination of factors surrounding Bumble’s strategic shift and financial outlook. Bumble is prioritizing quality over quantity in its user base, aiming to enhance the user experience and improve ecosystem health. This strategic pivot has led to a reduction in marketing expenditure, which is expected to impact revenue growth negatively in the short term.
However, this approach has resulted in a higher-than-expected EBITDA margin, indicating potential operational efficiency gains. Despite these positive signs, the uncertainty surrounding the effectiveness of this strategy and its impact on future revenue growth, particularly as 2025 is anticipated to be a transition year, has led to a cautious outlook. Consequently, Nathan Feather has maintained a Hold rating, reflecting a balanced view of the potential risks and rewards associated with Bumble’s current strategy.
Feather covers the Consumer Cyclical sector, focusing on stocks such as eBay, Revolve Group, and Chewy. According to TipRanks, Feather has an average return of 25.6% and an 89.66% success rate on recommended stocks.
In another report released yesterday, TD Cowen also maintained a Hold rating on the stock with a $6.00 price target.