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Snap Inc.
Snap Inc. (NYSE: SNAP) is a camera company whose principal product is Snapchat, a camera software that allows users to interact via short videos and photographs known as Snaps. Snapchat includes five parts (Camera, Communication, Snap Map, Stories, and Spotlight) and additional capabilities that work outside of the app. Most of its revenue is generated by selling advertising products such as Snap Ads and AR Ads. This is known as advertising revenue.
Why Should Investors Exit?
Valuation Methodology: Price/Earnings Per Share Multiple Based Relative Valuation
(Analysis by Kalkine Group)
* % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
Stock Recommendation:
SNAP's stock price has fallen 58.52% in the past six months and might fall even further from current levels. We have valued the stock using the Price/Earnings-based relative valuation methodology and arrived at a target price of USD 25.00.
Considering the company's leveraged balance sheet, a decline in revenue metrics, margin pressure, current valuation, and other technical indicators, we recommend a "Sell" rating on the stock at the closing price of USD 32.07 as of February 02, 2022.
Three-Year Technical Price Chart (as of February 02, 2022). Analysis by Kalkine Group
* The reference data in this report has been partly sourced from REFINITIV.
* All forecasted figures and industry information have been taken from REFINITIV.