Piper Sandler’s Top Technical Stock Picks: 20 Best Stocks

7. Match Group, Inc. (NASDAQ:MTCH)

Number of Hedge Fund Holders In Q2 2024: 43

Match Group, Inc. (NASDAQ:MTCH) is an American software company that operates a portfolio of dating applications. It owns some of the best known apps such as Tinder and Match. The past couple of years haven’t been great for the firm on the revenue front. Match Group, Inc. (NASDAQ:MTCH) earned $3 billion, $3.2 billion, and $3.4 billion in revenue during 2021, 2022, and 2023. This shows that growth has stalled, and between the 2021 start and the recent market close, the firm’s shares have bled 75%. Naturally, the drop indicates that investor sentiment isn’t great, and it has also led to activist investors smelling blood. So far in 2024, Elliot Management has built a $1 billion stake in the firm and Starboard Value has acquired 6.6% of Match Group, Inc. (NASDAQ:MTCH)’s shares. Consequently, the activist action is now at the heart of the firm’s hypothesis, and a turnaround or taking the firm private might generate tailwinds for Match Group, Inc. (NASDAQ:MTCH)’s stock. On the business front, the firm is currently seeing mixed response from paying Tinder users but its Hinge app posted 48% annual revenue growth to $134 million in the second quarter.

Since Tinder is key to Match Group, Inc. (NASDAQ:MTCH)’s business, here’s what management commented during the Q2 2024 investor call:

“Tinder delivered $480 million of direct revenue, up 1% year-over-year, up 4% FX neutral. Tinder payers climbed 8% year-over-year to approximately $9.6 million, an improvement from the 9% year-over-year decline last quarter and above our expectations.

Payers were down 78,000 sequentially. Tinder’s Q2 RPP increased 10% year-over-year. While growth in subscription revenue at Tinder was solid at 7% year-over-year in Q2, Tinder continued to experience pressure on a la carte revenue, which was down 17% year-over-year in the quarter. Tinder is rolling out various initiatives to address the ALC weakness, including unbundling current features such as Passport and See Who Likes You into ALC to attract users who may not be as open to subscriptions. Both are in test now. Additionally, the team will shortly be testing two new ALC features, one that contextualizes someone’s likes and another that helps foster ongoing engagement after matching. As a result, we’re optimistic that Q2 will be a trough for declines in year-over-year ALC revenue and that trends will gradually improve in the second half of the year.”