Morgan Stanley upgraded Grindr to Overweight from Equal-weight and raised its price target to $18 from $15, citing the company's upcoming ultra-premium subscription tier and telehealth expansion as catalysts for a new growth phase. The brokerage noted Grindr's shares have fallen about 36% over the past 12 months amid concerns that aggressive paywall-driven monetization was hurting user growth, but analysts now see a more sustainable, product-led strategy emerging through two new initiatives: EDGE, an AI-powered premium subscription offering, and Woodwork, a direct-to-consumer telehealth business. Morgan Stanley described Grindr as a one-of-one asset with roughly 15 million monthly active users, strong network effects, industry-leading engagement exceeding 65 minutes per daily active user, and EBITDA margins above 40%, yet the firm estimates the platform monetizes roughly 30% below comparable dating apps, leaving significant room for improvement. The planned launch of EDGE in late 2026 or early 2027, aimed at affluent power users with AI-powered profile recommendations, conversation insights and enhanced discovery tools, is a key part of the bullish thesis; following stronger-than-expected demand during testing in Australia at around $80 per month, Grindr is now evaluating pricing between $100 and $500 per month, and Morgan Stanley estimates EDGE could generate $78 million in revenue by 2028 in its base case. The bank also highlighted Woodwork, Grindr's telehealth brand offering erectile dysfunction treatments, GLP-1 weight-loss medications and peptides, which could tap into a large existing user base where around 30% of users already use ED medication and another 60% have considered it, projecting Woodwork could contribute $28 million in revenue by 2028. Combining the two initiatives, Morgan Stanley now forecasts revenue growth of 23% in 2026 and 17% in 2027, with EDGE and Woodwork accounting for roughly 60% of revenue growth through 2028, and expects Grindr's revenue to expand at an 18% compound annual growth rate between 2025 and 2028. The stock's valuation remains attractive, trading at about 11 times 2027 EBITDA, a roughly 35% discount to peers on a growth-adjusted basis, and the $18 price target implies about 25% upside from current levels, while the bull-case valuation of $29 suggests potential upside of more than 100% if both EDGE and Woodwork achieve strong adoption.
Grindr IncMorgan Stanley upgraded Grindr to Overweight and raised price target, citing upcoming premium tier and telehealth expansion.
Morgan Stanley