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What's behind Snap Stock's Dramatic Movements?

PART:
1 2 3 4 5 6
Part 6
What's behind Snap Stock's Dramatic Movements? PART 6 OF 6

What’s Snap’s Valuation?

Snap’s comprehensive valuation

Snap (SNAP) has an EV (enterprise value) of ~$11.7 billion. Peer companies International Business Machines (IBM), FireEye (FEYE), Symantec (SYMC), and Salesforce (CRM) have EVs of ~$167.9 billion, ~$2.5 billion, ~$22.8 billion, and ~$63.3 billion, respectively.

What&#8217;s Snap&#8217;s Valuation?

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Inside Snap’s price metrics

With a book value per share of ~$3.9, Snap is trading at price-to-book value of 3.9x. The estimated book value per share of the stock is ~$2.2 for 2017. The price-to-sales ratio of Snap is 28.9x, while the estimated price to sales is 15.4x for 2017.

Market capitalization

As of August 2, Snap was the fourth largest global Internet player in terms of market capitalization at ~$14.9 billion. In comparison, its peers have the following market capitalizations:

  • International Business Machines: ~$134.6 billion
  • FireEye: ~$2.6 billion
  • Symantec:  ~$18.9 billion
  • Salesforce: ~$64 billion

Earnings and sales

The EPS for last year came on total sales of $515 million. Sales for this year are expected to expand to ~$970.6 million in 2016 to ~$1,855.3 million next year.

Moving averages

The moving average refers to the average price of the security over a given period. On August 2, 2017, Snap closed the trading day at $12.65. Based on this figure, here’s how the stock fared in terms of its moving averages:

  • 33.4% below its 100-day moving average of $19
  • 25.6% below its 50-day moving average of $17
  • 15.7% below its 20-day moving average of $15

MACD

The moving average convergence divergence (or MACD) refers to the difference between the long-term and short-term moving averages. Snap recorded a MACD of -1.11 in the last 14 days.

Peer companies International Business Machines, FireEye, Symantec, and Salesforce reported MACDs of -2.08, 0.07, 0.47, and 0.62, respectively.

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