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MTCH – Market expectations are for record-high Uniform ROA, but management may be concerned about Tinder, growth opportunities, and Hyperconnect

September 14, 2021

  • Match Group, Inc. (MTCH:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 62.7x Uniform P/E. At these levels, markets are pricing in bullish expectations for the firm, but management may be concerned about their Tinder subscription base, revenue growth opportunities, and their Hyperconnect acquisition.
  • Specifically, management may lack confidence in their ability to sustain growth in revenue per payer (RPP) for Pairs in Japan, year-over-year Tinder subscriptions, and Non-Tinder brand ARPU. Furthermore, they may have concerns about the impact of their embedded legal and government relations costs on EBITDA. Management may also lack confidence in their ability to maintain a lower net leverage ratio, integrate their Hyperconnect acquisition, and capitalize on revenue opportunities for Tinder, Swipe apps, Plenty of Fish, and Hinge. Finally, management may lack confidence in their ability to further increase engagement and conversion through freemium experiences.