Match's (MTCH) stock price decline due to a lack of better Tinder monthly average users growth through Q2 is an overreaction, as Tinder shows progress and underlying trends are likely to continue improving through the end of 2026, Morgan Stanley said in a note Wednesday.

With Tinder's metrics indicating it is moving in the right direction and a fuller pipeline in H2 than in Q2, the stock could return to the high end of its $30 to $40 per share trading range intra-quarter, according to the note.

The brokerage said its conviction in the Tinder bull case is growing, and could turn more positive if it sees further evidence in the company's turnaround.

Morgan Stanley reiterated its equal-weight rating on the stock and boosted its price target to $40 from $38.

Shares of Match were down 8.5% in Wednesday trading.

Price: 37.73, Change: -3.51, Percent Change: -8.51