Axiom Looking For Match Group To Report Continued Growth At Tinder

Match Group Inc MTCH is scheduled to report its 2Q results on July 26, and is likely to report robust numbers, with Tinder maintaining its leadership, Axiom’s Victor Anthony said in a report. He reiterated a Buy rating on the company, with a price target of $18.

Analyst Victor Anthony estimated Match Group’s 2Q16 revenues at $297M, representing 19.2 percent y/y growth, and adjusted EBITDA at $88M, with margin at 29.6 percent. He commented that these estimates appeared beatable.

Continued Growth At Tinder

“We will be looking for continued strong growth at Tinder (+170K subs), steady improvements on core Match mobile conversion rates, and commentary from management on the positive EBITDA impact of the App/Play store fee changes,” Anthony wrote.

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Apptopia data for the past 60 days indicated that Tinder has maintained its download and MAU/DAU leadership. Tinder Social was expanded worldwide and would likely result in more engagement. Tinder’s EBITDA margin are expected to have expanded from the low 40 percent range.

“We also expect commentary on the progress of the launch of an advertising product on Tinder, slated for year-end,” the analyst mentioned. He added that depending on the ad load assumptions, Tinder may drive $40M-$50M in high-margin ad revenues in 2017. Moreover, a la carte services like Super Like seem to have reduced churn at Tinder.

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