Bumble rises as KeyBanc upgrades on 'attractive risk reward'

Jan. 10, 2023 8:57 AM ETBumble Inc. (BMBL)By: Chris Ciaccia, SA News Editor

Bumble (NASDAQ:BMBL) shares rose nearly 3.5% in premarket trading on Tuesday as investment firm KeyBanc Capital upgraded the dating app company, citing an "attractive risk/reward" at current levels and confidence the company can sustain strong revenue growth.
Analyst Justin Patterson raised his rating on Bumble (BMBL) to overweight from sector weight, while also raising the firm's EBITDA forecast to be above consensus.
"When coupled with product initiatives (e.g., Compliments, regional pricing), international ramps, and moderating FX headwinds, we are increasingly confident the core Bumble app can sustain 20%+ annual revenue growth," Patterson wrote in a note to clients.
Patterson also noted the competitive environment looks "stable" as there was a 12 point acceleration in indexed customer growth in December. That could mean there was a month-over-month improvement in average revenue per user across many dating apps, the analyst added.
Last month, Bank of America started coverage on Bumble (BMBL) with a buy rating, highlighting its "strong operational record" and "healthy fundamentals," among other positive attributes.
Analysts are mostly positive on Bumble (BMBL). It has a BUY rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates BMBL a HOLD.