Wall Street is betting against Tinder. Here’s why the company’s going to succeed

Tinder logo on mobile phone

Although it’s now accepted wisdom that online dating is the most popular way to meet a future mate, the industry still is perceived by many investors as prone to fads. Some new online service always seems to be ascending while yesterday’s winners are declining.

A few years ago, Tinder emerged as the hot new service. As time has gone on, the short interest on stock of Match Group, the parent of Tinder, since its IPO two years ago has increased to 46 percent of the float (according to Jefferies, meaning it would take 16 days to cover that position). Perhaps that’s an expectation that, as time goes on, the service’s popularity will wane.

I own Match’s stock because I believe there’s something fundamentally wrong with that logic.

Many investors are betting against Match Group, the parent company of Tinder. Those investors are missing some fundamentals at the company that make it very likely to succeed.

Read Eric Jackson’s commentary on CNBC.