Should you invest in Bumble shares after receiving an upgrade from Raymond James?

On Tuesday, Bumble Inc. (NASDAQ:BMBL) shares edged slightly higher, extending Monday’s gains to a net weekly gain of about 4.2%. The online dating platform plunged 30% after announcing its fiscal Q4 and FY 2021 results, creating an opening for investors to buy.

Raymond James has followed on a series of analyst upgrades after Evercore also upgraded to outperform from in line. The firm now has a price target of $48 per share on the online dating platform, reflecting an upside potential of 37%. On the other hand, Evercore’s PT of $50 per share reflects an upside of about 38.54%.

Bumble still looks overvalued

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From an investment perspective, Bumble shares trade at a steep forward P/E ratio of 167.61, making it less attractive to value investors.

In addition, analysts expect its earnings per share to decline by nearly 320% this year, before falling further more than 87% next year.

Therefore, long-term growth investors could also opt for alternatives in the market. However, with the Omicron variant threatening to bring about lockdowns, the stock could spike on speculation that online dating platforms will thrive in the new environment.

Technically, Bumble seems to be trading within a sharply descending channel formation in the intraday chart. However, the stock recently bounced back to recover from oversold conditions, pushing it towards the trendline resistance.

Therefore, investors could target pullback profits at about $33.04, or lower at $30.95, while $37.82 and 439.91 are crucial resistance zones.

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