BMBL For Love And For Money

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Dating app Bumble (BMBL) has lost ~65% of its value over the last four months. Indeed, it fell ~21% last Thursday and Friday alone over concerns about its subsidiary Badoo’s exposure to Russia/Ukraine – even though JP Morgan estimates Russia/Ukraine accounts for only 3-4% of BMBL’s revenue. This overreaction creates an opportunity heading into BMBL earnings Tuesday afternoon.

BMBL is a terrific app for those seeking long term relationships. It empowers women by requiring that they send the first message. Founder and CEO Whitney Wolfe Herd is a mission driven leader. And after the recent selloff, BMBL is attractively valued given its tremendous growth prospects.

In its 3Q21 earnings report, BMBL guided 2021 revenue to $765-$768 million and Adjusted EBITDA to $205-$207 million. At its current market cap of $2.34 billion, that’s a 3x multiple on current revenue and 11x on Adjusted EBITDA. That’s great value given the growth I see for BMBL and why I think now represents a terrific opportunity to start a position in this “leader of the future”.

You can buy your position Monday or Tuesday ahead of earnings, buy half before and half after, or wait until after. Obviously I don’t know what BMBL’s 4Q21 numbers will be or how they will be received but I do think now is the time to at least start nibbling.

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