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ALL DATING / CHAT APPS ARE NOT CREATED EQUAL :)
In this analysis, I will take a look at Ok Cupid (OKC), Plenty of Fish (POF), Meet Me (MEET) and Skout.
I collected SALE price of POF and OKC when each company was acquired by IAC, which also owns Match, Tinder, and many more dating and non-dating sites (College Student focused holdings company [MTCH]). I researched OKC's and POF's average Daily Active Users (DAUs) at time of sale to come up with valuation in terms of DAUs.
“PAST TRANSACTIONS”
The Sale of OKC was in 2011, while the sale of POF was in 2015. We can see that over the four years elapsed between sales, a premium over DAUs was paid, and more recent premiums are higher per DAUs So, if we take the Sale Price of OKC or POF and divide by the number of DAUs, we get $14.29 and $159 paid respectively. The average amount paid per DAU increased while the stats of OKC and POF. What I mean by this, is that POF has better traffic, and engagement compared to OKC. But Male to Female ratio was similar. Note however, that OKC and POF online statistics are fairly good in terms of user engagement, male to female ratio, and overall site traffic comparison world-wide and in USA (see table). POF’s user engagement and time spent on the site are also better when compared against OKC, so the premium over DAUs when compared to OKC is expected. However, the premium was too much and investors punished MTCH stock when the deal closed shortly after going public making MTCH lose almost 40% of its PPS in the coming months.
“MEET IS GOING TO BE AQUIRED”
Now, if we compare these metrics against the common "chatter" that is saying that MEET will "get acquired" by a "company" things start to look a little weird. MEET currently commands a Market Cap of $418M and a Price Per Share (PPS) of around $7.93 as of August 11, 2016. If we factor DAUs reported in the last earning announcement of 1.22 Million, this would signify a Price Per DAU of $339 per user! You're probably saying well they just acquired Skout right? So they should require a premium over POF’s $159 paid per DAU? Let's analyze this a bit…
The acquisition of Skout will increase the DAUs to a total of 2.1 M according to MEET's presentation. The higher DAUs for the new MEET + SKOUT is still well below the 3.5M or 3.6M of OKC or POF respectively. More precisely, this represents 40% less active users for MEET + SKOUT when compared to OKC or POF at time of sale. We'll come back to this "40% less active users" number shortly.
Let's look at MEET's and Skout's user engagement metrics and visitors. According from information from Alexa and siteanalytics, MEET and SKOUT have a score of 7,244 and 16,901 respectively. High score numbers aren't good. For example, Google is scored as 1. The lower the better. In the table we can see that OKC and POF have a respectable 708 and 682 respectively. Along with 3.43M Unique visitors for OKC and 4.19M for POF. When we compare this data against MEET and SKOUT things don't look so good. MEET and SKOUT aren't even close to 1M Unique Visitors using the same benchmarks used for OKC and POF. Alexa also scores MEET and SKOUT substantially worse than OKC and POF (7,244 for MEET and 16,901 for SKOUT). This doesn't reinforce the idea that OKC, POF, MEET and SKOUT are in the same class.
Let's now take a look at user engagement and demographics. Things get a little more interesting here. We can see than on average OKC and POF users view more pages and spend more time on each service, Even with Skout's "better" numbers, their smaller footprint will not improve MEET by much. So why would advertisers pay premiums to MEET and SKOUT when they can reach a broader/ more engaged audience in OKC and POF?
Also let's look at the male / female ratio of all these services. We can see that MEET's and Skout's look awfully familiar to Ashleymadison.com's ratio. As you recall, this website was hacked and showed that almost every female in that website was a bot or fake user. This would be devastating to MEET's price. I'm not saying its users are fake, but I have taken a stroll in all apps and you can clearly tell a difference between the users in OKC and POF when compared to MEET. Something to consider if you ask me.
VALUATION for "SALE"
So let's have a hypothetical sale of MEET + SKOUT using the same $159 per DAU used for POF. This would result in a market cap of around $335M and PPS of $6.41 (-20% than current prices). BUT does MEET warrant this premium that POF commands with respectable Alexa score, unique visitors, user engagement, and DAUs? Highly unlikely. When Facebook acquired What's app, they paid around $42 per user. Let's say however, that MEET commands 70% of the premium paid for POF. This would result in a $112 price per DAU, a share price of $4.49 (-56% Decrease in PPS), and $234 in market cap. But why would anybody be interested in acquiring MEET when their PPS is way overvalued?
For matter of discussion, let's say someone wants to offer a premium of 25% compared to the current stock price and offer to buy out MEET at $10 per share. This would mean the buyer would place a value of $250 per DAU! It's an astronomical value for a user that spends very little time in the website and is not even engaged. Make no mistake, MEET is NOT an Instagram, SnapChat, Twitter, or Facebook. Tinder, Match, OKC, POF, BUMBLE, HAPPN, LINE, WHATSAPP, WECHAT; and the many many other apps will not sit idle waiting for MEET to increase their market share.
MEET COMPETITORS
To compete MEET will need to increase marketing spend. MEET will more than likely have $38M in cash next quarter and after they pay Skout, will be left with $9.5M in Cash or Cash equivalents. This will decrease the liquidity of the company. And since they want to continue to increase market share and new users they will need to find ways to raise money through Debt or a secondary public offering, which will dilute the stock.
SUMMARY:
MEET will decrease in PPS when the acquisition of SKOUT finalizes, due to the huge decrease in Cash Reserves AND because Skout management can sell their 5.37 Million shares at that time too.
MEET will likely have a secondary stock offering at current high prices to raise money for the acquisition of Skout and remain liquid and to increase marketing spend.
MEET will not be an attractive takeover target, like it has not been the past decade, due to the inflated market cap and low user engagement, and poor financials that will result from the acquisition.
MEET will have to increase marketing spend to increase new users, which will be hard when competing against dating apps and chat apps.
MEET is NOT a good Long Term Stock, major correction coming. Possible dilution of shares if secondary offering takes place.
MEET fair value of DAUs in the $4-5 range.
Is there any identifiable resistance point? I took a quick look at a 5-yr chart and it looks like this is new, high territory for the stock price...unless I missed a R/S somewhere along the line.
The company had a great earnings report and doing some great things behind the scenes. Charts are simply amazing and giving no hints of a retrace or consolidation. This baby is still humming along beautifully.
What do you think bud? I've more than tripled my Nov 2015 investment...time to take profits or wait at least 3 months to turn it into a LONG term investment for tax purposes??
$MEET ~ somebody show me a better 1 year chart. What a story here. Congrats to all long, longs.
Wow....investorshub has some REAL charts now (tradingview). Nice! GL $MEET longs! Going to be a good month.
This quarter looks like a blowout, I wish I had bought before. I was planning to see what they had to say about the acquisition on the call. Oh well :) Good luck to all those involved here it seems like it's seriously undervalued here even after the pop so I might see how it trades and then initiate a small position.
Skout, they say will be accretive quickly. Plus they have been much more successful abroad in monetizing which is one area meet has performed poorly. Also meet has been more successful in selling ad space and generating revenue. Looks like a good combo plus less than 5% overlap in users so a huge collective boost toward greater scale.
What do you guys think about the most recent acquisition? Skout seems like a bit of a distraction, but also like it could unlock value. The price seems steep to me.
Congrats T M and to all, nice little article you posted there about MEET!!!
MEET has been very good to me. I've been patient since QPSA.
Just rec'd this...excellent analysis.
http://news.cmlviz.com/2016/07/20/care-com-inc-and-meetme-inc-head-to-head-compare.html
Ed
$7 break today? MEET meeting expectations!!!
Otc markets is not my style. But I'm sure they will love to see that on THAT stocks board.
no Pump and instead real time Facts as STV* operates Firstmet.com with $2 mil in cash and 1 Q rev of $2.7 mil and o/s at 39 mil but flaot of only 6 mil means insiders own everything and once traffic reach to certain level then they will sell company in few dollare oer share...
https://www.firstmet.com/?link=logo&from=nav
Trafficestimate....
http://www.trafficestimate.com/firstmet.com
http://www.trafficestimate.com/meetme.com
ALEXA....
http://www.alexa.com/siteinfo/firstmet.com
http://www.alexa.com/siteinfo/meetme.com
Bruhhh lol morning to all
Seriously bruh. You going to come on this board and pump STVI? Lol ok man.
MEET way overvalue as there are a lot of dating site out there with decent traffic compare to meetme at fraction of $300 mil
example.... STV* pps at .15 should be at $2.50 compare to MEET at + $6 or +$300 mil in market cap base of traffic comparison ...$2 mil in cash...rev 1 q at $2.7 mil... traffic/members 35% of meet....
Trafficestimate....
http://www.trafficestimate.com/firstmet.com
http://www.trafficestimate.com/meetme.com
ALEXA....
http://www.alexa.com/siteinfo/firstmet.com
http://www.alexa.com/siteinfo/meetme.com
This stock is great. I've been in since January. A lot of things going on. The skout acq was huge. Company is solid with their earnings and a prime candidate for a buyout. Welcome to MEET!
Maybe for close
Good day here glad I got in last week??????
I say 6.25
$MEET ~ This baby has been overbought for quite some time and keeps booming along. What an amazing ride we've had here.
Been watching this for weeks looks good on ichimoku will be adding later this week for Monday/Tuesday pop
MEET doing it again, I gotta get some shares for long term here soon, congrats to all!!!
Thanks bud, I have some learning to do! Never heard of the aroon oscillators.
The RSI is a great indicator but MEET has had so much momentum it's really hard to predict when it may sell off a bit and consolidate. The RSI has been in overbought territory since 4.50 and keeps going higher. The accumulation/distribution line appears to be tipping a bit south which indicates some are taking a little profit off the table. The MACD continues to head higher as well which shows great strength and momentum. The aroon oscillator is at 96 and the aroon up 25 is at 96. When it starts dipping toward the 70 level it appears it may correct and consolidate. As long as the aroon up stays above 70 or comes back close to it and bounces back up it will trade sideways for a bit or head back up. Once it starts dipping below the 70 level it may be time to take some profit. Don't buy or sell on account of anything I say. Just keep watching those indicators. This has had one heck of a ride over the past year +. Stockcharts.com will give you all this info once you play around with the indicators.
bud...I'm not an accomplished chartist, what metric do I need to watch that will give me "overbought" info? The RSI was up over 75 which should give us some concern, right?
Agreed...need that "meat" to absorbed any additional shares that might hit the market in their buyout deal.
Wow MEET has meat in its bones, seems every drop gets bought up , nice stock here
Where did the money come from?
They had 26M in cash and just paid 28M in cash and a lot of shares for their purchase of a competitor.
[url]
https://www.twst.com/update/meetme-inc-meetme-to-acquire-skout/[/url][tag]insert-text-here[/tag]
Wonder if we'll see a PR that they have sold additional shares to raise the extra cash???
Added to russell 2000. Good things happening here and more room to go. Watch the charts and trade accordingly. When getting overbought, take your profit, when getting oversold grab more.
Like what you're saying b_f...have a double+, but I think there is more coming. What do you think?
Thanks...nice to hit one. Now, the tough part, how long to hang on? LOL My gut says that it is going higher...I'll be watching it closely!!
What an amazing story. Chart is a thing of beauty and has been for quite some time = BOOM
Congratulations!!! Seems it may be entering blue skies from here, now on the Russell 2000 nice job and wow you got a great price GLTU and all!
It's EXCEEDING my expectations!! I'm in at $2.62 last Nov!
MEET seems to be meeting expectations GLTA!!!
They broke thru a price point hoping for more up to carry it over $5
Been following about a year now. Solid fundamentals and a great trading stock. Trade to the charts.
Huge volume and nice move yesterday for MEET!
This attributed to yesterday volume: From Yahoo Msg Board "Louis Navellier is the newsletter writer that picked up MEET"
Go MEET!
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