Morgan Stanley Upgrade Overview
Morgan Stanley upgraded Grindr from equal‑weight to overweight and lifted its price target to $18, up from $15, after the stock fell roughly 36% over the past twelve months.
The brokerage highlighted Grindr’s roughly 15 million monthly active users, network effects, average daily engagement exceeding 65 minutes per user and EBITDA margins above 40%, while noting the platform currently monetises about 30% less than comparable dating apps.
Grindr plans to launch EDGE, an AI‑powered ultra‑premium subscription tier, in late 2026 or early 2027; testing in Australia showed demand at about $80 per month and the company is now evaluating pricing between $100 and $500 per month, with Morgan Stanley estimating EDGE could generate $78 million of revenue by 2028 in a base‑case scenario.
The firm also emphasized Woodwork, Grindr’s direct‑to‑consumer telehealth brand offering erectile‑dysfunction treatments, GLP‑1 weight‑loss drugs and peptides; approximately 30% of users already use ED medication and 60% have considered it, and Woodwork is projected to contribute $28 million of revenue by 2028.
Combining the two initiatives, Morgan Stanley forecasts revenue growth of 23% in 2026 and 17% in 2027, with EDGE and Woodwork accounting for roughly 60% of revenue expansion through 2028, and an overall compound annual growth rate of 18% from 2025 to 2028.
The bank values Grindr at about 11 times its projected 2027 EBITDA, representing a roughly 35% discount to peers on a growth‑adjusted basis; the $18 target implies about 25% upside from current levels, while a bull‑case target of $29 suggests potential upside of more than 100% if the new products achieve strong adoption.
Key risks cited include heightened competition, weaker‑than‑expected uptake of EDGE and Woodwork, and the possibility that Grindr may fail to sustain a pattern of earnings beats and upward‑guidance revisions.