Match ‘s SP500 Inclusion a Good Excuse to Reach $200

Bullish   
Match stock aiming for $200, but not much higher

Match Group Inc. rose over 10% in post-market trading Friday following reports that it is going to be included in the S&P 500. The company, which owns Tinder, OkCupid and most other major dating apps in the U.S., has a market cap of over $41B.

Despite the anticipated “summer of love”, though, this is not Match ‘s highest ever valuation. At $148 a share, the stock is actually down from its all-time high of nearly $175 reached in February. Friday’s post-market jump to $164 makes sense, of course. The S&P 500 inclusion is virtually guaranteed to attract plenty of institutional money to the name. Individual long-term investors, however, might want to think twice before following suit.

S&P 500 inclusion means Match stock can reach $200

The daily chart above reveals that the uptrend from the February 2016 bottom is an almost complete five-wave impulse. The pattern is labeled (1)-(2)-(3)-(4)-(5) and has been developing within the parallel lines of a trend channel. The five sub-waves of wave (3) are also visible.

Valuation and Elliott Wave Analysis Caution Against Buying Match Stock

Note that waves (2) and (4) ended shortly before touching the 61.8% and 38.2% Fibonacci levels, respectively. If this count is correct, Match is currently trading in its fifth and final wave. As per the Elliott Wave theory, a three-wave correction follows every impulse. It usually erases the entire fifth wave.

Wave (5) is supposed to exceed the top of wave (3), so targets above $175 make sense. We wouldn’t be surprised if the stock makes it to $200 a share. In our opinion, that should be seen as a final take-profit opportunity by the bulls. The anticipated correction has the potential to drag Match back to the support of wave (4) near $130 or even lower.

Besides, at $148 a share, Match trades at 13.6 times its 2021 sales and a forward P/E ratio of 63. At $200, the earnings multiple would’ve expanded to 85. The S&P 500 inclusion certainly gave the bulls an excuse to make the stock even more expensive. This doesn’t make it a sound investment, though. Both Elliott Wave analysis and the company’s valuation caution against it.

Similar Elliott Wave setups occur in the Forex, crypto and commodity markets, as well. Our Elliott Wave Video Course can teach you how to uncover them yourself!

New to Elliott Wave?

Elliott Wave principle offers a completely new understanding of what the nature of the markets is, what drives them and what can be derived from their movement. This course is for those of you, who have been looking for an honest Elliott Wave guide, describing the method’s advantages over other trading tools, but not hiding its weaknesses.

Check Video Course    or     Check our eBook


See our Video Course
or check our eBook

Last year over 60k readers trusted EWM Interactive to help them in their trading decisions.

I’m very happy i discovered your service. Thanks so much and keep up the good work!

- Xavier N.

Just loving your analysis. Thank you so much, really wished you add some more currencies to your list You have a client for life :)

- J. Kotzee

I love the way EWM does business: response times & overall friendly demeanor are fantastic... and the prices are very fair. The trade recommendations read like like they come from a seasoned trader that is used to winning. Couldn't ask for more.

- C. Montgomery

I love the way EWM does business: response times & overall friendly demeanor are fantastic... and the prices are very fair. The trade recommendations read like like they come from a seasoned trader that is used to winning. Couldn't ask for more.

- C. Montgomery

I’m very happy i discovered your service. Thanks so much and keep up the good work!

- C. Montgomery

Just loving your analysis. Thank you so much, really wished you add some more currencies to your list You have a client for life :)

- C. Montgomery