The deluge of bullish analysts came as expected on Monday, but it was only enough to initially lift Snap, Inc. (NYSE:SNAP) shares marginally higher. Citi, Jefferies, JMP Securities, Goldman Sachs, William Blair, Morgan Stanley, Cowen, and RBC Capital were some of the firms initiating coverage of Snap with positive ratings ahead of Monday's market open. 

Snap stock soared 16% last week after just three Wall Street pros initiated coverage with bullish market calls. Why did the stock open a mere 1.5% higher on Monday after several more analysts -- including some of the industry's heaviest hitters -- chimed in with upbeat reports? Bias and expectations are combining to keep Monday's initial move in check.

The analysts kicking off their coverage of Snapchat's parent company with bullish perspectives were among the more than two dozen underwriters that helped take Snap public earlier this month. If you had just handed over Snap stock at $17 to your top clients nearly four weeks ago, it's a safe bet that you would continue to be bullish with the stock in the low $20s. There's a bias to the bullishness.

As for expectations, the Securities and Exchange Commission requests that companies taking a company public refrain from publishing research until at least 25 days after the IPO. That window just opened over the weekend, so naturally it's when many of those firms will be initiating coverage.

Snapchat's Memories feature on a smartphone app.

Image source: Snap, Inc.  

Bulls charge in

It's only natural for the market to place more weight on the bullish coverage initiated by Monness Crespi Hardt, Drexel, and OTR Global last week. They weren't part of the IPO. Their upbeat views aren't blurred by bias, and those positive nods were certainly not expected.

We still can't dismiss the wave of encouraging market calls being made this morning, though.

  • Citi initiated coverage with a buy rating and a $27 price target.
  • Morgan Stanley tagged the stock with its overweight rating, setting a low goal of $28 and a high mark of $40 for the shares.
  • Goldman kicked off its research with a buy and a price target of $27.
  • Cowen went with a $26 price goal and an outperform rating.
  • JMP Securities initiated coverage with an outperform call and a price target of $30.
  • RBC Capital is going with a $31 price goal and an outperform rating.
  • William Blair also pegged the stock as an outperform on Monday.

Not every underwriter jumped in with bullish coverage. Some of the firms initiating their research on Monday went with neutral market calls. They helped take Snap public at $17, so there's no obligation to support the enterprise now that it's trading well above that price. However, so many prominent bulls -- including Morgan Stanley and Goldman that combined to distribute roughly half of the shares -- is still an encouraging sign for a stock that has been proven highly volatile in its first few weeks on the market. They had a choice with the stock trading north of $20, and they opted to come out as bullish with healthy price targets. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.