Shares of Grindr may be due for some sizable gains over the next 12 months, according to Goldman Sachs. Analyst Eric Sheridan initiated coverage of the LGBTQ social network and dating app with a buy rating, setting his price target at $20. That reflects around 27% upside from Friday’s close. The analyst said the company’s total addressable market is “large and growing,” which could support a long growth runway from here as a result. “Based on our fundamental work, we see Grindr as a revenue compounder with high margins that are positively levered to a number of long-term secular growth themes/opportunities within online dating,” he said in a Monday note. “While the online dating sector has been impacted by ongoing investor debates around sources of user growth and user time/engagement, we see GRND as having a user demographic and core proposition that has performed well against such debates (which we expect to persist into 2025 and beyond).” When it comes to its total revenue, Sheridan sees the company producing a compound annual growth rate of 20% over the next five years, resulting in a rise from $337 million in 2024 to $849 million in 2029. He noted payer growth and advertising as two main growth drivers. Along with that, the analyst also expects adjusted EBITDA margins to stay stable through 2029, even though there could be some near-term compression due to investments in headcount re-scaling, product development and its platform infrastructure. Sheridan is among the three total analysts on the Street covering Grindr, all of whom have a buy rating, per LSEG data. Its average target of $19.33 also implies nearly 23% upside potential. GRND YTD mountain GRND, year-to-date The stock has outperformed the broader market this year, seeing year-to-date gains of more than 79%. That’s almost triple that of the S & P 500. Shares also rose around 1% in the premarket on the heels of the call.
