Wall Street Zen Upgrades Snap (NYSE:SNAP) to "Buy"

Key Points

• Wall Street Zen upgraded Snap from “hold” to “buy.” Despite the upgrade, analyst consensus remains “hold,” with a $7.31 average price target.
• Snap reported quarterly EPS of $0.03 and revenue of $1.72 billion, up 14.3% year over year. Revenue and daily active users missed expectations, raising concerns about the advertising recovery.
• Snap cited 30 million paid subscribers and a return to net profitability as positives, but some analysts have lowered price targets and a change in user-engagement metrics may complicate comparisons.

Snap (NYSE:SNAP - Get Free Report) was upgraded by equities researchers at Wall Street Zen from a "hold" rating to a "buy" rating in a research report issued to clients and investors on Saturday, Wall Street Zen reports.

Several other equities analysts have also recently commented on the stock. Royal Bank Of Canada restated a "sector perform" rating and set a $8.00 price target on shares of Snap in a report on Thursday, September 17th. Wells Fargo & Company boosted their price objective on Snap from $5.00 to $6.00 and gave the company an "equal weight" rating in a research note on Tuesday, August 4th. DA Davidson raised their target price on shares of Snap from $5.00 to $5.25 and gave the stock a "neutral" rating in a report on Tuesday, August 4th. Freedom Capital upgraded shares of Snap from a "hold" rating to a "strong-buy" rating in a research report on Tuesday, August 4th. Finally, Evercore set a $8.00 price objective on Snap in a research note on Tuesday, August 4th. One equities research analyst has rated the stock with a Strong Buy rating, eleven have assigned a Buy rating, twenty-three have issued a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat.com, the stock has a consensus rating of "Hold" and a consensus target price of $7.31.

Snap Stock Performance

Shares of SNAP stock opened at $4.97 on Friday. Snap has a 1 year low of $3.81 and a 1 year high of $9.13. The company has a debt-to-equity ratio of 1.75, a current ratio of 2.94 and a quick ratio of 2.94. The firm has a fifty day moving average price of $5.75 and a 200-day moving average price of $5.40.

Snap (NYSE:SNAP - Get Free Report) last issued its quarterly earnings results on Wednesday, November 4th. The company reported $0.03 earnings per share (EPS) for the quarter. The business had revenue of $1.72 billion for the quarter, compared to the consensus estimate of $1.73 billion. Snap had a negative return on equity of 14.61% and a negative net margin of 4.90%. The business's quarterly revenue was up 14.3% on a year-over-year basis. During the same period in the prior year, the firm posted ($0.06) earnings per share. As a group, sell-side analysts anticipate that Snap will post -0.03 earnings per share for the current year.

Insider Transactions at Snap

In other Snap news, insider Ajit Mohan sold 6,797 shares of the company's stock in a transaction on Wednesday, September 16th. The shares were sold at an average price of $5.82, for a total transaction of $39,558.54. Following the completion of the transaction, the insider owned 4,965,300 shares in the company, valued at approximately $28,898,046. This represents a 0.14% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CAO Rebecca Morrow sold 20,000 shares of Snap stock in a transaction on Wednesday, September 9th. The shares were sold at an average price of $5.35, for a total value of $107,000.00. Following the transaction, the chief accounting officer owned 578,105 shares in the company, valued at approximately $3,092,861.75. This trade represents a 3.34% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last three months, insiders sold 445,926 shares of company stock valued at $2,326,930. Corporate insiders own 22.68% of the company's stock.

Institutional Trading of Snap

A number of hedge funds have recently bought and sold shares of SNAP. Signaturefd LLC increased its stake in Snap by 68.9% in the 3rd quarter. Signaturefd LLC now owns 5,211 shares of the company's stock valued at $28,000 after buying an additional 2,126 shares during the period. Jacobi Capital Management LLC purchased a new position in Snap during the 3rd quarter valued at about $30,000. Fifth Third Bancorp grew its stake in Snap by 6,678.0% in the first quarter. Fifth Third Bancorp now owns 6,778 shares of the company's stock worth $31,000 after purchasing an additional 6,678 shares during the period. NFSG Corp increased its stake in shares of Snap by 52.7% in the 1st quarter. NFSG Corp now owns 8,400 shares of the company's stock worth $39,000 after purchasing an additional 2,900 shares in the last quarter. Finally, EverSource Wealth Advisors LLC lifted its holdings in shares of Snap by 135.6% in the 1st quarter. EverSource Wealth Advisors LLC now owns 8,525 shares of the company's stock valued at $39,000 after acquiring an additional 4,907 shares during the last quarter. Hedge funds and other institutional investors own 47.52% of the company's stock.

Key Headlines Impacting Snap

Here are the key news stories impacting Snap this week:

• Positive Sentiment: Snap returned to net profitability and beat adjusted earnings expectations. Its 30 million paid subscribers also point to growing subscription revenue and a potential complement to advertising. Article: Snap Shares Fall More Than 10% as Revenue and User Growth Miss Forecasts Despite Higher Earnings Article: Snap Q3: The Potential Is There - The Conviction Isn't
• Neutral Sentiment: Traders bought a high volume of Snap call options, suggesting some are positioning for a rebound; options activity is not a reliable indication of future performance. Article: Traders Purchase High Volume of Call Options on Snap
• Negative Sentiment: Third-quarter revenue rose 14% year over year to $1.72 billion but missed estimates, while daily active users also came in below expectations. The shortfalls raised concerns about the pace of Snap’s advertising recovery and overshadowed its earnings improvement. Article: Snap shares fall 13% as revenue and daily users miss estimates
• Negative Sentiment: Several analysts cut price targets, reinforcing a more cautious outlook: Citigroup and UBS lowered targets to $6 and kept neutral ratings; JPMorgan cut its target to $5 and maintained an underweight rating; Cantor Fitzgerald lowered its target to $5 and stayed neutral. Barclays also halved its target to $8, though it retained an overweight rating. Citigroup ratings UBS ratings JPMorgan ratings
• Negative Sentiment: Snap also announced a change in how it measures user engagement, which may complicate comparisons with prior periods as investors assess user trends. Article: Snap tumbles on revenue, user growth miss; announces metric shift

Snap Company Profile

Snap Inc is a technology and social media company best known for Snapchat, a visual messaging and social networking application. Snapchat enables users to communicate through photos, videos, messages and Stories, while offering creative tools such as augmented reality (AR) Lenses and filters. The platform also includes features such as Snap Map, Spotlight and content from publishers and creators.

Snap generates most of its revenue from digital advertising, including video, augmented reality and other advertising formats delivered across Snapchat.

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