Spark Networks SE (LOV) stock gained today, here is why?

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The stock of Spark Networks SE (LOV) gained value in the current market trading session. The stock gained 14.98% from the previously closed value to reach $3.07. At the end of the previous trading session, the stock closed at $2.65. The average volume of the stock traded in the trading session was around 266.26K. The reason for the stock gain could be linked to the release of its financial statements a week ago.

The release of quarterly report effect on its stock:

LOV stock released its 3rd quarter report on 15th November 2021. After the release of their financial report and its plans for their new developments like introducing new features, Zoosk Live is one of the top brands of Zoosk. The company also plans to return $3 million in debt which is a sign of the company’s strength; investors are taking interest in its stock. Their stock is gradually increasing since 15th November. The sudden interest of investors in its stock increased the trading volume for a short period which caused a sudden decline but after the number returned to the average volume, the stock started to gain value gradually.

Financial highlights:

  • The total revenue of the company was $52.3 million in this quarter. In the same quarter of the year 2020, the revenue was reported to be $60.8 million.
  • The company reported a Net Loss of $2.7 million. In the same quarter of the previous year, the Net loss was $0.1 million.
  • Their adjusted EBITDA was reported to be $5.0 million. This was $7.6 million in the same quarter of the last year.
  • The company reported a total cash and cash equivalent to be $12.4 million.
  • As of the 3rd quarter, the company’s total debt was $84.7 million. Their total debt till the end of the year 2020 was $99.1. This is a decline of $14.4 million in total debt. The company plans to pay more debt in the next quarter.

Business insights:

  • The company reported that its top 4 brands brought 50% of the total revenue.
  • Their 5th largest brand Zoosk is gradually pacing towards bringing more traffic as its traffic increased by 50% in this quarter after the launch of the new feature Zoosk Live. The company expects that the new subscriber base will bring revenue making it profitable.
  • The company reiterates 2021 full-year revenue guidance from $219 million to $223 million.
  • The company reiterates 2021 full-year adjusted EBITDA guidance from $27 million to $30 million.

Conclusion:

After the release of its financial statements the company stock’s trading volume increased due to the interest of the investors, but the price started to take pace after the trading volume set back to the average number. The company’s new subscribers base is expected to bring more revenue for the company which could increase its profitability.

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