What happened
Shares of Snap (SNAP 27.63%) have jumped today, up by 8% as of 2:45 p.m. EDT, after the Snapchat parent received some bullish notes from Wall Street. The company is also set to report third-quarter earnings results tomorrow after market close.
So what
Credit Suisse reiterated an outperform rating on Snap shares while increasing its price target by a buck to $21. Analyst Stephen Ju raised his estimate for third-quarter ad revenue by $10 million after conducting advertiser checks, and also boosted Credit Suisse's forecast for 2019 earnings per share from $0.26 to $0.28.
Image source: Snap.
Separately, Lightshed Partners initiated coverage on Snap with a buy rating and a $20 price target. The tech company's new rating echoes analyst Rich Greenfield's previous rating while he was at BTIG Research. Greenfield had turned bullish in March and subsequently raised his price target from $15 to $20 in June before leaving BTIG to form Lightshed with colleagues in September. Greenfield believes that concerns around competition and user metrics are "unfounded."
Snapping Back: Initiating Snap at BUY with $20 Price Target $SNAP @Snap @Snapchat https://t.co/2SfrP8iM1c
— Rich Greenfield (@RichLightShed) October 21, 2019
Now what
Snap shares are up over 160% year to date as the company has put together a turnaround. Daily active users (DAUs) have returned to growth following a revamped Android version of Snapchat, which has in turn helped bolster ad revenue.
The company's guidance calls for third-quarter revenue in the range of $410 million to $435 million, which should translate into adjusted EBITDA of negative $60 million to negative $85 million.
