Why Dating App Bumble's Stock Is Falling In Today's Premarket

Shares of Austin, Texas-based Bumble, Inc. ($BMBL), an online dating and social networking platform, fell sharply in the early premarket session after a Wall Street firm turned cautious regarding the stock.

Bumble stock, which has lost about 26% of its market value so far this year, declined 3.31% to $5.84 in premarket trading. On Stocktwits, retail sentiment toward the stock remained ‘bearish’ (31/100) by early Friday, and the message volume fell to ‘low’ levels.

In a note summary, the Fly stated that Goldman Sachs downgraded Bumble to ‘Neutral’ from ‘Buy’ and also trimmed the price target to $7 from $8. According to analysts at the research firm, the stock's risk-reward ratio is more balanced at current levels. Delving into the fundamentals, the analysts reportedly said visibility into a turnaround of the company's core Bumble app remains low until at least mid-2026.

Goldman does not expect improvements in Bumble's user numbers in the near term, given its view that the company’s broader trust and safety initiatives and quality improvement of the overall user base will take longer to play out.

Posing a competitive threat, social media giant Meta’s flagship Facebook app announced last week that it is introducing two new Facebook Dating features: a dating assistant and Meet Cute. These features aim to help users skip the swipe and provide fresh ways to connect with potential dates. Bumble, on the other hand, is reportedly working on a new artificial intelligence-powered matchmaking app.

After reporting a second-quarter beat in early August, Bumble guided to below-consensus third-quarter revenue. Susquehanna analysts largely overlooked the subpar revenue guidance, raising the price target for the stock to $7 from $5 and maintaining a ‘Neutral’ rating. The analysts expressed comfort with the progress the company made on the cost-reduction front. They, however, noted that the company continues to face headwinds as it executes its quality-first strategy.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: Nasdaq, S&P 500 Futures Rise Ahead Of Fed Speeches: Strategist Says Current Bull Run Unstoppable Even As Shutdown Enters Third Day

Share

·

Add us on