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On Wednesday, Cantor Fitzgerald reaffirmed its Neutral stance on Snap Inc (NYSE:SNAP) with a consistent price target of $12.00. The firm’s analysis followed Snap’s fourth-quarter earnings, which reported revenues and EBITDA surpassing Wall Street’s estimates by 1% and 11%, respectively, according to data from Visible Alpha. The social media company’s daily active users (DAUs) increased by approximately 10 million, about 2 million above Snap’s previous guidance. According to InvestingPro data, Snap maintains strong liquidity with a current ratio of 4.04, though its EBITDA remains negative at -$768.16M for the last twelve months.
Snap’s quarterly report highlighted a robust performance in its Snap+ and direct response (DR) segments, with a year-over-year growth of 14%. However, the brand advertising segment faced challenges, showing a 1% decline year-over-year, despite having a comparatively easier comparison from the previous year. Snap’s first-quarter revenue growth guidance for 2025, projected at 10-14% year-over-year, aligns with the mid-point of analysts’ expectations and is anticipated to bolster confidence in the company’s revenue growth trajectory. InvestingPro analysis reveals that while the company isn’t currently profitable, analysts predict profitability this year, with an EPS forecast of $0.27 for 2024. Get detailed insights and 6 additional ProTips with an InvestingPro subscription.
The company’s shares have lagged behind its online advertising peers year-to-date, influenced by the ongoing uncertainty regarding the potential TikTok ban. While acknowledging positive trends in recent quarters, including a significant 33.18% price return over the past six months, Cantor Fitzgerald remains cautious due to risks associated with the rollout of new user experiences and advertising product launches. These factors contribute to the firm’s decision to stay neutral and retain the $12 price target for Snap stock. Based on InvestingPro’s Fair Value analysis, the stock currently shows potential upside from its current trading price.
In other recent news, Snap Inc has seen a variety of analyst evaluations following its Q4 2024 performance. Rosenblatt Securities raised its stock target for Snap from $11 to $12, maintaining a neutral stance. The firm acknowledged Snap’s transition from brand to performance marketing and the positive impact of the Snapchat+ subscription service.
Simultaneously, Barclays (LON:BARC) confirmed an overweight rating on Snap with a steady price target of $16.00. The firm highlighted the company’s robust Q4 performance, attributing its growth to strong Direct Response advertising and a significant expansion in Other Revenue, mainly from Snapchat+.
Morgan Stanley (NYSE:MS) maintained an equal weight rating on Snap, with a price target of $10.00. While acknowledging better than expected results, the firm expressed a need for more consistent performance. Wolfe Research also maintained a peer perform rating on Snap, citing decelerating top-line growth, macroeconomic volatility, and subdued user engagement trends.
Finally, Stifel maintained a hold rating on Snap with a steady price target of $11.00. The firm noted improvements to Snap’s business model positively affected the company’s margin outlook but remained cautious due to mixed results from recent initiatives. These are some of the recent developments for Snap Inc.
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