Analyst: IAC/InterActiveCorp To Score With Match.com Spin-Off

IAC/InterActiveCorp's

plans to retain an 80 percent stake in its Match Group, plus a potential spin-off of its e-commerce unit, are reasons to own the shares, an analyst said Thursday. Barry Diller-controlled IAC unveiled plans Thursday to spin off 20 percent of its Match group later this year. http://iac.com/media-room/press-releases/iac-announces-intent-pursue-ipo-match-group-appoints-joey-levin-ceo-iac The Match unit's revenue grew 11 percent to $897.2 million during 2014, and amounted to about 29 percent of IAC's total revenue. https://www.sec.gov/Archives/edgar/data/891103/000089110315000004/iaci-20141231x10k.htm#s4413508C8DFD1ED6C1638642F4A320E2 Axiom's Victor Anthony said the future potential for spinning off the remaining 80 percent Match stake helps bolster the value of IAC. In addition to Match.com, the unit includes the newer dating service Tinder, as well as the test preparation business Princeton Review. Anthony, who maintained a Buy rating and $85 target on IAC, called its largest segment, search, "challenged." Search revenue fell last year about 1 percent in 2014 to $1.6 billion, and includes brands like About.com, Ask.com and Investopedia. But Anthony said IAC's move Thursday to name Joey Levin chief executive "suggests confidence that the search business can return to respectable growth." Levin was formerly head of IAC's search unit. A possible further spin-off of IAC's HomeAdvisor e-commerce business "would be another catalyst, and we assume the company will continue to aggressively buy back shares," Anthony said. IAC's e-commerce unit which includes HomeAdvisor as well as ShoeBuy, saw revenue grow by 3 percent last year to $435.4 million. Its media unit owns The Daily Beast and Vimeo, and revenue in that segment fell 5 percent to $181.8 million in 2014. IAC, which formerly held controlling interests in Expedia Inc.

and Ticketmaster Group, gained nearly 5 percent Thursday, trading recently at $80.98.