What happened

Shares of Snap (SNAP 4.71%) have surged today, up by 10% as of 12:20 p.m. EST, after getting two price-target increases from Wall Street analysts. Both Wells Fargo and Evercore ISI have boosted their valuation estimates on the Snapchat parent.

So what

Wells Fargo analyst Brian Fitzgerald raised his price target on Snap from $44 to $62 while reiterating an overweight rating. Fitzgerald is optimistic that the macroeconomic recovery in the U.S. will help sustain the momentum that many tech companies enjoyed in 2020. At the same time, lockdown restrictions are loosening and it's unlikely that lawmakers will seek to raise taxes until conditions improve.

Snapchat logo

Image source: Snap.

Evercore ISI analyst Kevin Rippey increased his price target from $42 to $57 while maintaining an outperform rating. Evercore added Snap stock to the firm's "Tactical Outperform" list, citing encouraging checks with advertisers during the holiday shopping season. Marketers "were the most bullish we have ever heard," according to Rippey.

Now what

Rippey is modeling for Snap to post revenue growth of 65% to 70% in the fourth quarter, which is the highest estimate on Wall Street. Facebook reported strong Q4 results last night, which is also encouraging for the sector, in Rippey's view.

Snap is set to report fourth-quarter results on Feb. 4, but the company did not provide any guidance due to ongoing macroeconomic uncertainty related to the pandemic. The consensus estimate calls for $854.3 million in revenue, which would represent 52% growth from a year ago.