Asset structure analysis
Match Group’s total assets were $4.5 billion and $4.18 billion as of December 31, 2023 and as of December 31, 2022, respectively.
Goodwill was $2.34 billion in 2023, accounting for 52% of total assets.
The amount of goodwill is huge, which indicate that the company completed a lot of acquisitions in the past years.
Total current assets were $1.27 billion in 2023, consisting of 28.2 % of total assets.
Cash and cash equivalents were $862 million in 2023, making up 19% of total assets.
Liquidity and solvency analysis
Total current liabilities were $531.7 million in 2023.
Current ratio for 2023 was 2.39, which mean that current assets covered current liabilities 2.39 times for 2023.
Total shareholders’ equity was -$19 million , which indicate that Match Group’s total assets did not cover its total liabilities.
Will the company go bankrupt?
We need to look at cash flow for the company.
Net cash provided by operating activities was $897 million, $527 million and $912 million in 2023, 2022 and 2021, respectively.
Net cash from operations could support the debt by borrowing new money to pay off old debts.
We don’t like to borrowing new money to pay off old debts.
Match Group will not go bankrupt, but debt is always to be repaid.
Generally, we see goodwill as cost ,but not asset.
Profitability analysis
Match Group ‘s revenue was $3.36 billion, $3.19 billion and $3 billion in 2023, 2022 and 2021, respectively.
Revenue in 2023 was up 5.3% year-on-year.
Revenue in 2022 was up 6.3% year-on-year.
The company’s growth rate is slow.
Net earnings $651 million, $360million and $277 million in 2023, 2022 and 2021, respectively.
Net profit margin was 19%, 11.3% and 9.2% in 2023, 2022 and 2021, respectively.
Stock-based compensation expense was $232 million, $204 million and $147 million in 2023, 2022 and 2021, respectively.
Stock-based compensation expense would reduce valuation in company.
Cash flow analysis
Net cash provided by operating activities was $897 million, $527 million and $912 million in 2023, 2022 and 2021, respectively.
Conclusion
Given that stock-based compensation expense was offset by repurchasing stocks, we roughly estimate that the company’s disposable cash flow is about $600 million each year.
According to 10 years to calculate , we get a valuation of $6 billion.
Then, this valuation add back net asset(-$ 19 million), and subtract goodwill ($2.34 billion) and intangible assets($306 million).
Finally, we get a valuation, which is about $3.17 billion in market capitalization.
Our estimate is very rough.
Disclaimer: The content is for reference only and does not constitute investment advice.
Introduction
Match Group, Inc., through its portfolio companies, is a leading provider of digital technologies designed to help people make meaningful connections. Our global portfolio of brands includes Tinder®, Hinge®, Match®, Meetic®, OkCupid®, Pairs™, Plenty Of Fish®, Azar®, BLK®, and more, each built to increase our users’ likelihood of connecting with others. Through our trusted brands, we provide tailored services to meet the varying preferences of our users. Our services are available in over 40 languages to our users all over the world.
