Fannie Mae, Freddie Mac shares tumble after conservatorship comments
On Wednesday, Cantor Fitzgerald analyst Deepak Mathivanan adjusted the price target for Snap Inc (NYSE: NYSE:SNAP) shares, bringing it down to $7.00 from the previous $8.00, while maintaining a Neutral rating on the stock. Currently trading at $7.49, Snap has shown remarkable resilience with a nearly 14% return over the past week, according to InvestingPro data. The revision followed Snap’s first-quarter results, which surpassed the company’s earlier projections, bolstered by a strong performance in North America.
Snap reported a quarterly increase of 7 million daily active users (DAUs), and year-over-year growth in content consumption. With revenue growth of 14.91% and a strong current ratio of 4.3, the company’s advertisement products have been performing well in several key areas, positively impacting the core Direct Response (DR) segment. The first quarter was seen as positive for Snap, indicating a solid execution of its business strategies.
Despite these gains, Snap encountered challenges due to macroeconomic uncertainties that began to surface in April. As a result, the company chose not to issue a second-quarter forecast. Mathivanan noted that Snap’s advertising revenue is particularly susceptible to changes in the economic environment, which could lead to significant fluctuations in growth.
While Snap experienced revenue growth in the early part of April, Mathivanan expressed concerns about the lack of visibility for the remainder of the year. This uncertainty has led to a cautious stance on the outlook for the second half of 2025. The revised price target of $7.00 is based on a 16 times multiple of the projected FY26E EBITDA of $645 million. Notably, InvestingPro analysis shows broader analyst targets ranging from $7.40 to $16.00, with additional insights and financial health metrics available in the comprehensive Pro Research Report, which covers over 1,400 US stocks.
In other recent news, Snap Inc. reported a first-quarter revenue of $1.4 billion, representing a 14% year-over-year increase, which slightly surpassed both Susquehanna’s and market consensus estimates. The company’s direct response advertising business also grew by 14%, while brand advertising experienced a 3% decline. Despite the strong quarterly performance, Snap did not provide guidance for the second quarter, citing macroeconomic uncertainties. Analysts from Susquehanna, BMO Capital Markets, Barclays (LON:BARC), BofA Securities, and Goldman Sachs have all adjusted their price targets for Snap, reflecting a more cautious outlook amidst these uncertainties.
Susquehanna lowered its price target to $8, maintaining a Neutral rating, while BMO Capital Markets reduced its target to $13 but kept an Outperform rating, citing robust growth in active advertisers. Barclays adjusted its target to $15, maintaining an Overweight rating, and noted Snap’s resilience compared to previous downturns. BofA Securities set a new target of $10, expressing concerns about user growth saturation and high stock-based compensation expenses. Meanwhile, Goldman Sachs lowered its target to $8.50, maintaining a Neutral stance and highlighting Snap’s efforts to diversify revenue and enhance its direct response advertising business.
Snap’s Snapchat+ service saw a significant subscriber increase, nearly reaching 15 million, marking a 59% year-over-year growth. The company also reported satisfactory user metrics, with overall daily active users reaching 460 million, slightly above estimates. Despite these achievements, Snap’s decision to withhold revenue guidance has led to mixed reactions among analysts, who remain focused on the company’s strategic initiatives and potential for future growth.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.