NEW YORK (TheStreet) -- Shares of media and Internet company IAC/InterActiveCorp (IACI) are up 3.85% to $71.00 after it recently bought an additional 10% of Tinder from venture capitalist Chamath Palihapitiya for $500 million, sources say, Bloomberg reports.
That values Tinder Inc., a mobile-dating site with 10 million daily users, at $5 billion, compared with IAC's $5.57 billion market capitalization.
TheStreet Ratings team rates IAC/INTERACTIVECORP as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate IAC/INTERACTIVECORP (IACI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and reasonable valuation levels. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 91.30% and other important driving factors, this stock has surged by 60.08% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, IACI should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- IAC/INTERACTIVECORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, IAC/INTERACTIVECORP increased its bottom line by earning $3.27 versus $1.81 in the prior year. This year, the market expects an improvement in earnings ($3.90 versus $3.27).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 88.8% when compared to the same quarter one year prior, rising from $40.74 million to $76.92 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Internet Software & Services industry and the overall market, IAC/INTERACTIVECORP's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: IACI Ratings Report