Ironically, during the week prior to Valentine’s Day investors seem to have decided that a website that plays match maker is not for them as the dating website Cupid has seen its shares drastically drop. In fact, the company shares are down 1p and the company lost almost an entire quarter of its value at the start of the week. Peel Hunt, the house broker, stated that Cupid has been hit by short sellers with one online blog mostly to blame for the large amount of sales.
Analyst for Peel Hunt, Paul Morland, stated that some sites such as BeNaugthty.com have fueled scare stories for website like Cupid. Nothing has actually happened to undermine the trust of investors, but because of the story that frightened investors many people sold.
The article on the blog wrote that Cupid overvalued its own sales forecast, but in reality this forecast was in line with what the industry forecast was. They believe that based on news from the industry there was no other reason for short sales but the blog story.
It would seem that investors are not listening to the rhetoric of stock market analysts, because the share price continues to decline in price and investors are not changing their minds about the sale.
The company has put out a statement explaining that it has been trading in line with all expectations outlined to the investors and that there is no material reason that explains why the share price has fallen.
At the end of 2012 before the crash the company was able to report a profit of £14m cash. Cupid also mentioned a consumer radio programme that was looking into the online dating world and stated that it is doing everything it can to align itself with all legal rules.