Downside risks are: 1) integration risk from smartwatches and other wearables

Downside risks are: 1) integration risk from smartwatches and other wearables cannibalizing the fitness tracker market, 2) fad risk, as fitness trackers could be simply a fitness fad with consumers, 3) competitive risk from competitors out-innovating, and 4) execution risk on channel build and inventory management. GoPro (GPRO) Our $8 price objective is based on 10x our 2018E EBITDA, in line with the peer average of 10x, which we believe is appropriate given its slightly higher growth and potential for EBITDA margin expansion after restructuring. GoPro is the leading action camera company in the world but has been challenged by execution issues limiting its ability to drive strong product cycles. Downside risks to our PO are: 1) new products fail to resonate with consumers, 2) competitive pressure pushing down ASPs, and 3) failure to meet market demand during holidays. Upside risks to our PO are: 1) better than expected sales on new products, 2) better than expected holiday sales from extra manufacturing capacity, 3) better than expected drone sales, or new product announcements, and 4) new direct sales partnerships internationally GrubHub (GRUB) Our PO is $49, based on 32x our 2018E P/E (vs. high growth internet at 31x). We believe GRUB warrants a premium to eCommerce peers due to the attractive margins of the core business and, relative to the overall small-cap sector, GRUB has more attractive margins and growth potential. Downside risks to our PO are: Revenue and sales metrics are trailing KPls for Diners and Restaurant and the potential for diminishing returns on future restaurant and user additions is a risk. GrubHub has significant room for growth in the US ahead, but will need to invest internationally if domestic growth stalls. LendingTree (TREE) Our $140 price objective represents 14x 2018E EV/EBITDA, a premium to the lead generation services and marketplace peer group average of 11x due to market position (category leader in mortgage and personal loans) and faster revenue growth. Risks to achieving our estimates and price objective are: 1) interest rate risks given the demand for leads for mortgage and other loan products, 2) competition with other consumer finance sites and ad networks, 3) potential for search engine disintermediation and traffic competition, 4) potential for recessionary impact on loan products (lower traffic and demand for leads) and credit card markets, 5) premium valuation vs. lead generation and marketplace peers, and 6) acquisition risk. Match Group (MTCH) Our PO is $21 based on 12x our estimated 2018 EBITDA of $562mn and our DCF valuation analysis. The basis for our PO is in-line with the eCommerce group, but a premium to the consumer internet subscription services group due to MTCH's combination of market dominance, profitability, and cash flow. We think fundamentals help MTCH stand out from its ecommerce peer group and MTCH should be seen as a more defensible platform that is unlikely to see disruption in its core markets. Downside risks are: market share losses to an emerging dating business, potential for higher acquisition costs on mobile, lower conversion rates that lead to lower PMC growth, the need to acquire competing sites to maintain growth or market share, and Bankof America Merrill Lynch Internet/e-Commerce | 06 April2017 955 HOUSE_OVERSIGHT_014941