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Snapchat Snags its first buy rating

21 March 2017

Monness Crespi Hardt initiated its coverage of the disappearing-photo app, recommending that clients Snap them up with a price target of $25.

If that were to come to pass, that would be roughly 30% upside from last Friday's closing price.

"We see a company with the potential to outpace revenue growth of peers by 7x, along with a steep margin trajectory, while peer margins have likely peaked", he said in a report. "There is substantial execution risk, but we're prepared to give the benefit of the doubt at this stage knowing what we know about Snap and knowing what we know about the efforts of its competitors". That forecast helped lift shares, which jumped nearly 4% during midday trading before closing up 2%.

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Most of Wall Street has given Snap a thumbs-down following its IPO earlier this month.

It was high praise in comparison to other Wall Street analysts, who have thus far given Snap either a "Sell" or a "Hold".

SNAP shares have struggled since coming public.

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Snap Inc. shares hit below $20 for the first time since the company's $3.4 billion public listing recently.

And the analyst community was quick to pile on with a pretty bearish set of initial ratings.

Based on the average of analysts' buy, sell and neutral recommendations, Snap is the worst-rated stock among 288 USA companies that have a market capitalization of at least $20 billion, according to Thomson Reuters data.

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Snapchat Snags its first buy rating