Analyst: Bumble Stock Is ‘De-Risked’

Loop Capital Markets upgraded Bumble to “buy”

Shares of online dating firm Bumble Inc (NASDAQ:BMBL) are 5.7% higher before the bell, following a bull note from Loop Capital Markets. The analyst upgraded BMBL to “buy,” calling it “de-risked,” praising the company’s cash balance and free cash flow generation, both of which will help shield its balance sheet.

 

Coming into today, analysts were mostly bullish on Bumble stock, but there’s room for an unwinding of pessimism. Coming into today, 10 of 16 covering brokerages rated the equity a “buy” or better, but six recommended a “hold.” 

Short interest added 29.1% in the last two reporting periods, yet the 7.27 million shares sold short account for 5.4% of the stock’s available float. At the security’s average pace of trading, it would take shorts nearly four days to buy back their bearish bets.

Short-term options traders, meanwhile, have been much more pessimistic than usual. This is per Bumble stock’s Schaeffer’s put/call open interest ratio (SOIR) of 12.84 that ranks higher than 97% of reading from the past 12 months.

On the charts, BMBL yesterday touched a new record low of $14.14, lending credence to the thought that now is an intriguing time to buy. Set to end September with a 13.7% loss, the stock is down more than 31% in 2023.

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