Snap (NYSE:SNAP) Trading Down 4.7% – Here’s Why

Snap Inc. (NYSE:SNAP) shares fell 4.7% during trading on Wednesday . The stock traded as low as $4.74 and last traded at $4.9150. 14,553,863 shares were traded during mid-day trading, a decline of 71% from the average session volume of 50,565,348 shares. The stock had previously closed at $5.16.

More Snap News

Here are the key news stories impacting Snap this week:

• Negative Sentiment: Snap’s launch of Specs at $2,195 has sparked pushback from investors and the broader market, with concerns that the price is too high for mass adoption and could limit near-term sales. Why Is Snap Stock Falling On Wednesday?
• Negative Sentiment: Multiple reports highlighted skepticism around Snap’s new consumer AR glasses, reinforcing concerns that the company’s long-term hardware strategy may be expensive and uncertain. Snap bets on life beyond smartphones with $2,195 Specs augmented-reality glasses
• Negative Sentiment: CEO Evan Spiegel defended Specs as a long-term strategic investment, but that also underscored investor concern that Snap is doubling down on a costly initiative instead of focusing on near-term profitability. Snap CEO Spiegel defends Specs as long-term bet, pushes back against activist pressure
• Neutral Sentiment: Snap also announced new safeguards for younger users, including tighter content-sharing limits for ages 13-15 and dedicated profiles for users under 16, which may help with trust and regulatory concerns but is unlikely to move the stock materially today. SNAP Introduces New Safeguards for Younger Users
• Neutral Sentiment: Unusually heavy call-option activity suggests some traders are positioning for upside, but it does not offset the immediate concern around the Specs launch. 5 Best Stocks to Buy Under $10

Wall Street Analyst Weigh In

Several brokerages recently commented on SNAP. Barclays raised Snap from an “overweight” rating to an “overweight” rating in a report on Monday, April 27th. UBS Group set a $8.00 target price on Snap in a research report on Thursday, May 7th. HSBC downgraded Snap from a “hold” rating to a “hold” rating in a research report on Monday, April 27th. Morgan Stanley lowered their target price on Snap from $9.50 to $6.50 and set an “equal weight” rating on the stock in a research report on Sunday, February 22nd. Finally, Stifel Nicolaus lifted their target price on Snap from $4.50 to $5.25 and gave the company a “hold” rating in a research report on Tuesday, April 21st. One analyst has rated the stock with a Strong Buy rating, nine have issued a Buy rating, twenty-three have given a Hold rating and two have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company currently has a consensus rating of “Hold” and a consensus price target of $7.79.

Snap Trading Down 3.8%

The stock has a fifty day simple moving average of $5.64 and a 200 day simple moving average of $6.12. The firm has a market capitalization of $8.39 billion, a P/E ratio of -20.69 and a beta of 1.03. The company has a quick ratio of 3.53, a current ratio of 3.53 and a debt-to-equity ratio of 1.67.

Snap (NYSE:SNAP) last released its quarterly earnings data on Wednesday, May 6th. The company reported ($0.05) earnings per share for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.14). The business had revenue of $1.53 billion during the quarter, compared to the consensus estimate of $1.53 billion. Snap had a negative return on equity of 18.92% and a negative net margin of 6.72%.The business’s revenue was up 12.2% on a year-over-year basis. During the same period last year, the company earned ($0.08) EPS. As a group, research analysts forecast that Snap Inc. will post -0.06 EPS for the current year.

Insider Transactions at Snap

In other news, General Counsel Zachary M. Briers sold 129,493 shares of the company’s stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $5.60, for a total value of $725,160.80. Following the completion of the transaction, the general counsel owned 2,644,538 shares of the company’s stock, valued at $14,809,412.80. This represents a 4.67% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Ajit Mohan sold 44,785 shares of the company’s stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $5.60, for a total value of $250,796.00. Following the completion of the transaction, the insider directly owned 5,057,891 shares of the company’s stock, valued at approximately $28,324,189.60. This trade represents a 0.88% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders have sold 2,900,631 shares of company stock valued at $16,054,989.

Hedge Funds Weigh In On Snap

Hedge funds have recently made changes to their positions in the business. Korea Investment CORP boosted its position in shares of Snap by 573.6% during the 3rd quarter. Korea Investment CORP now owns 967,544 shares of the company’s stock valued at $7,460,000 after acquiring an additional 823,900 shares during the last quarter. Contrarius Group Holdings Ltd purchased a new position in shares of Snap in the third quarter valued at $10,256,000. DNB Asset Management AS grew its holdings in shares of Snap by 433.6% in the third quarter. DNB Asset Management AS now owns 1,042,873 shares of the company’s stock valued at $8,041,000 after purchasing an additional 847,447 shares in the last quarter. Quantbot Technologies LP grew its holdings in shares of Snap by 54.4% in the third quarter. Quantbot Technologies LP now owns 749,724 shares of the company’s stock valued at $5,780,000 after purchasing an additional 264,156 shares in the last quarter. Finally, Ausdal Financial Partners Inc. grew its holdings in shares of Snap by 76.3% in the third quarter. Ausdal Financial Partners Inc. now owns 628,109 shares of the company’s stock valued at $4,843,000 after purchasing an additional 271,893 shares in the last quarter. Institutional investors own 47.52% of the company’s stock.

About Snap

Snap Inc is a camera and social media company best known for developing and operating Snapchat, a multimedia messaging application that allows users to send photos, videos and messages that disappear after being viewed. In addition to its core messaging service, Snap offers a suite of augmented reality (AR) tools, including custom Lenses and Filters, that enable users and third-party developers to create interactive and immersive experiences. The company also provides advertising solutions that allow brands to engage audiences through Snap Ads, Sponsored Lenses and Discover content on the platform.

Founded in 2011 by Evan Spiegel and Bobby Murphy, Snap has continually focused on innovation in camera technology and AR.