Social Networking Platform MeetMe Sees Big Share Price Rise

MeetMe’s share price jumped Monday morning, confirming the stock as an analyst favorite. In the past month, the company's share price has risen 56.05 percent.

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Social media platforms like Facebook (NASDAQ:FB) and Twitter (NYSE:TWTR) are so ubiquitous that it’s difficult to think of a time before their influence. However, before they came to dominate the social media scene, they were just small companies working to make a name for themselves.

It’s an interesting exercise for investors to speculate what the next big social media platform will be. MeetMe (NASDAQ:MEET) is one platform that is trying to become a major presence in the social media market. With a market cap of $106.41 million, the company has a long way to go before it can compete with the behemoths in the space. Nonetheless, it has a compelling product and investors are starting to take note.

Social strategy at MeetMe

MeetMe’s MeetMe.com is a social network for meeting new people to chat with on the web and on mobile platforms, including Apple’s (NASDAQ:APPL) iPhone and iPad and Google’s (NASDAG:GOOGL) Android devices.

The website and corresponding app work by promoting social interaction, information sharing and other topics of interest to users. Like the popular dating app Tinder, MeetMe.com is location-based, meaning that it connects users based on geographical proximity. With around 4.98 million monthly active users, MeetMe.com is a popular destination for social media users.

Investor interest

MeetMe generates revenue through advertising, in-app purchases and paid subscriptions. Many of these monetization efforts are targeted at the company’s mobile traffic. According to the American Trade Journal, 70 percent of users access the social media platform via mobile applications. The MeetMe.com website and app are available in multiple languages, including English, Spanish, Portuguese, Chinese, Dutch and Korean.

Investors appear to have faith in MeetMe’s business model, and its share price is on the rise. The American Trade Journal states that currently company insiders own 13.7 percent of the company, while institutional investors own 22 percent. Individual investors are also keen to dip their toes into MeetMe — the company’s share price opened at $2.30 on Monday morning, and reached a 52-week high of $2.52 later in the day. At close of day, MeetMe was trading at $2.45, up 6.99 percent from the previous day.

And although Monday’s share price increase is notable, MeetMe’s share price has actually been increasing steadily over the last several weeks. Over the past month, MeetMe’s share price has seen a 56.05-percent increase.

Future estimates

This strong share price movement has prompted analysts to look favorably upon MeetMe. According to Zacks, the company “could be an interesting play for investors. This is because, not only does the stock have decent short-term momentum, but it is seeing solid activity on the earnings estimate revision front as well.” Indeed, “consensus estimates have moved sharply higher for both [the coming quarter and year] over the past four weeks.”

Investors will be able to gain further insight into MeetMe on November 3. That day, the company will host a conference call led by CEO Geoff Cook and CFO David Clark to discuss MeetMe’s Q3 report, which will be released prior to the call.

 

Securities Disclosure: I, Morag McGreevey, hold no direct investment interest in any company mentioned in this article.

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