Valentine’s Day is just around the corner. With it comes a reminder that there will always be people looking for love. When there’s a need to be fulfilled, chances are that there’s a company looking for a way to meet that need.
When it comes to selling love -- or at least an approximation of it -- these three dating companies offer some of the best places to seek out that spark. Just be careful. Love may be blind, but the internet is also full of folks looking to separate you from your money.
Read on to see which of these dating stocks just might be the one that’s worth investing your time and money into.
No. 1: The company offering to light the spark that ignites a fire of passion
Match Group (NASDAQ: MTCH) is the business behind over a dozen different dating apps. Some of its most popular include Tinder, Plenty of Fish, OKCupid, The League, and of course, its eponymous match.com. That diversity of platforms, approaches, and offerings helps Match.com stay competitive in a market where tastes are ever changing and consumers can get frustrated and move on when one attempt fails.
From a financial perspective, Match Group trades around 23 times its anticipated forward earnings. That’s not too bad for a business that is expected to increase its earnings by 22% annualized over the next five or so years.
No. 2: The dating site where women make the first move
If there’s a common complaint among women, it’s that they often get hit on by the wrong men, in the wrong places, and at the wrong times. Bumble (Nasdaq: BMBL) attempts to address this concern by making it a requirement that only women can send the first contact message between potential matches. That unique setup is a key reason why Bumble has achieved a nearly $5 billion market capitalization and is among the top most downloaded dating apps in the United States.
Unlike its more established counterpart, it’s a bit tougher to make a valuation-based cased for Bumble’s shares. The company is expected to earn around $0.19 per share in 2023, giving it a price to anticipated earnings ratio well over 100.
Still, if Bumble’s ladies first strategy helps set it aside from the crowd, it could potentially grow into its valuation. The company does expect organic growth, but unfavorable currency fluctuations and the Russia & Ukraine conflict are acting as headwinds. As a result, patience may be a prudent course of action for potential investors.
Bumble Inc
No. 3: A media giant that knows all about matching you to your preferences
Streaming giant Netflix (Nasdaq: NFLX) was one of the first companies to use a machine learning technique known as a recommendation engine to help match people to their movie preferences. By helping you find more content similar to what you already like, it helps extend your watch time and make its service more useful for you.
Thanks to a recently announced partnership with Bumble, Netflix is extending its reach into the dating business as well. For a limited time at least, Bumble is featuring a game called “Netflix Night In” that offers matches a chance to answer trivia questions with each other around popular Netflix shows. The rationale behind this is that Bumble users find it easier to talk to their matches if they have something in common like interest in television shows.
From an investor’s perspective, if the algorithm to find a matching movie is compatible with the algorithm to find a matching life partner, then it could add yet another reason to stick with Netflix. Plus, since this partnership with Bumble is only a small part of Netflix’s overall empire, it could be reasonable to consider if you’re not sure you want to fully commit to a dating-platform-first type investment.
After all, not every relationship that starts with dinner-and-a-movie ends up with a lifelong commitment, and it’s good to have choices.
You might even be able to love more than one of them
If owning a stake in the business of finding love is something that interests you, each of these three companies offer different reasons to consider them as a potential partner. Fortunately, when it comes to investing, there’s no need to be loyal to just one company’s stock. Take some time to look over all three of them, and decide for yourself just how many you’d like to connect with.
At the time of publication, Chuck Saletta did not own shares of any company mentioned in this article.
Sources – EasyResearch, Match, Yahoo Finance, New Yor Post, Bumble, Earth Web, Netflix Research, Tech Crunch
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