Why Did Snap Shares Rise Last Week?
SNAP shares rose 18.4%
Shares of Internet technology (QQQ) firm Snap (SNAP) rose 18.4% last week (ended August 18, 2017) to close at $14.01. Snap is now trading 24% above its all-time low of $11.28 and 52% below its all-time high of $29.44.
On August 15, 2017, analyst Kip Paulson from Cantor Fitzgerald upgraded Snap shares to “overweight” from “neutral” and maintained a 12-month price target of $15. However, one day previously, Cantor Fitzgerald had lowered the firm’s share price target to $15 from $17 while maintaining a “neutral” rating on the stock.
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Paulson expects increasing competition, advertising pricing, and lock-up expirations to impact Snap shares over the next 15 months.
Snap’s 2Q17 results
Shares of Snap fell ~14% on August 11, 2017, after the firm announced disappointing 2Q17 results. Snap reported revenue of $181.7 million, with EPS (earnings per share) of -$0.16, compared with the analyst revenue estimate of $186 million and EPS of -$0.14.
In 2Q17, Snap added fewer users than estimated, recording only 7 million new users in 2Q17, compared with 8 million new users in 1Q17. Analysts expected Snap to add 10 million new users in 2Q17.
Notably, while Snap’s 2Q17 revenues doubled from $71.8 million in 2Q16, its net loss rose from $116 million in 2Q16 to $443 million in 2Q17.