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Will Tinder Gold Drive Match Group's (MTCH) Q1 Earnings?
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Match Group, Inc. (MTCH - Free Report) is set to report first-quarter 2018 results on May 8.
The company has had a dismal earnings surprise history in the trailing four quarters, missing estimates all through, with an average negative surprise of 5.3%. In the last reported quarter, it missed estimates by 6.5%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Match Group is the world’s foremost provider of dating products and operates a portfolio of more than 45 brands. Three of its biggest and best known brands are Match.com, OkCupid and Tinder. The company’s reputation, established user base and size are likely to prove conducive to the upcoming earnings.
About 60% of the company’s revenues come directly from users of its dating services in North America, mostly in the form of membership subscriptions. Online dating has been expanding, as users from more demographics join the fray. Most of Match Group’s users connect from mobile devices, where conversion to paid members is also higher. In the last reported quarter, its average subscriber base rose 24% year over year, driven primarily by solid contribution from Tinder. Match and OkCupid also registered modest growth. This momentum bodes well for the company’s top-line growth in the quarter under review.
Match Group has been reaping profits for the past three years and recording top-line expansion as well. The company is currently enjoying strong growth, driven by robust momentum at Tinder and solid performances from Meetic, Match as well as PlentyOfFish.
Match Group, Inc. Price, Consensus and EPS Surprise
Match Group recently rolled out a Tinder Gold subscription package, which has driven incremental ARPU as well as subscriber growth. Tinder’s ARPU actually grew 32% in the last reported quarter. Recently, the company also launched the “Likes You” feature, along with a bunch of other optimizations. These factors will drive the results of the quarter under review.
In the last quarterly report, Match Group provided its revenue projections for first-quarter 2018 in the range of $380-$390 million (reflecting 29% year-over-year growth at the mid-point), with an EBITDA of $115-$120 million for the quarter (reflecting 36% year-over-year growth at the mid-point). The company also typically suffers adverse seasonality in its first quarter, which is usually its lowest-margin quarter. Also, the company’s marketing spend is usually the highest in the first quarter, which will also impact margins in the upcoming results.
However, weaker-than-expected advertising revenue growth trends might dent the company’s top line in the to-be-reported quarter. Further, profits might be affected due to higher investments in Tinder along with higher-than-expected data costs and professional fees.
Earnings Whispers
Our proven model does not show that Match Group will beat earnings estimates in the upcoming quarterly results. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. But that is not the case here as you will see below.
Zacks ESP: Match Group has an Earnings ESP of -4.17%,as the Most Accurate estimate of 23 cents is pegged below the Zacks Consensus Estimate of 24 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank of 3, which increases the predictive power of the ESP. However, the company’s negative ESP makes surprise prediction difficult.
Conversely, we caution against stocks with a Zacks Ranks #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.
Stocks That Warrant a Look
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +10.00% and a Zacks Rank of 2. The company is likely to release first-quarter 2018 earnings on May 8.
Array BioPharma Inc. (ARRY - Free Report) has an Earnings ESP of +25.83% and a Zacks Rank of 2. The company is likely to release third-quarter fiscal 2018 earnings on May 9.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Will Tinder Gold Drive Match Group's (MTCH) Q1 Earnings?
Match Group, Inc. (MTCH - Free Report) is set to report first-quarter 2018 results on May 8.
The company has had a dismal earnings surprise history in the trailing four quarters, missing estimates all through, with an average negative surprise of 5.3%. In the last reported quarter, it missed estimates by 6.5%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Match Group is the world’s foremost provider of dating products and operates a portfolio of more than 45 brands. Three of its biggest and best known brands are Match.com, OkCupid and Tinder. The company’s reputation, established user base and size are likely to prove conducive to the upcoming earnings.
About 60% of the company’s revenues come directly from users of its dating services in North America, mostly in the form of membership subscriptions. Online dating has been expanding, as users from more demographics join the fray. Most of Match Group’s users connect from mobile devices, where conversion to paid members is also higher. In the last reported quarter, its average subscriber base rose 24% year over year, driven primarily by solid contribution from Tinder. Match and OkCupid also registered modest growth. This momentum bodes well for the company’s top-line growth in the quarter under review.
Match Group has been reaping profits for the past three years and recording top-line expansion as well. The company is currently enjoying strong growth, driven by robust momentum at Tinder and solid performances from Meetic, Match as well as PlentyOfFish.
Match Group, Inc. Price, Consensus and EPS Surprise
Match Group, Inc. Price, Consensus and EPS Surprise | Match Group, Inc. Quote
Match Group recently rolled out a Tinder Gold subscription package, which has driven incremental ARPU as well as subscriber growth. Tinder’s ARPU actually grew 32% in the last reported quarter. Recently, the company also launched the “Likes You” feature, along with a bunch of other optimizations. These factors will drive the results of the quarter under review.
In the last quarterly report, Match Group provided its revenue projections for first-quarter 2018 in the range of $380-$390 million (reflecting 29% year-over-year growth at the mid-point), with an EBITDA of $115-$120 million for the quarter (reflecting 36% year-over-year growth at the mid-point). The company also typically suffers adverse seasonality in its first quarter, which is usually its lowest-margin quarter. Also, the company’s marketing spend is usually the highest in the first quarter, which will also impact margins in the upcoming results.
However, weaker-than-expected advertising revenue growth trends might dent the company’s top line in the to-be-reported quarter. Further, profits might be affected due to higher investments in Tinder along with higher-than-expected data costs and professional fees.
Earnings Whispers
Our proven model does not show that Match Group will beat earnings estimates in the upcoming quarterly results. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. But that is not the case here as you will see below.
Zacks ESP: Match Group has an Earnings ESP of -4.17%,as the Most Accurate estimate of 23 cents is pegged below the Zacks Consensus Estimate of 24 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank of 3, which increases the predictive power of the ESP. However, the company’s negative ESP makes surprise prediction difficult.
Conversely, we caution against stocks with a Zacks Ranks #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.
Stocks That Warrant a Look
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
GW Pharmaceuticals PLC , with an Earnings ESP of +8.11% and a Zacks Rank of 1, is slated to report second-quarter fiscal 2018 results on May 8. You can see the complete list of today’s Zacks #1 Rank stocks here.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +10.00% and a Zacks Rank of 2. The company is likely to release first-quarter 2018 earnings on May 8.
Array BioPharma Inc. (ARRY - Free Report) has an Earnings ESP of +25.83% and a Zacks Rank of 2. The company is likely to release third-quarter fiscal 2018 earnings on May 9.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>