Open main menu
Home
Random
Donate
Recent changes
Special pages
Community portal
Preferences
About Stockhub
Disclaimers
Search
User menu
Talk
Contributions
Create account
Log in
Editing
Snap
(section)
Warning:
You are not logged in. Your IP address will be publicly visible if you make any edits. If you
log in
or
create an account
, your edits will be attributed to your username, along with other benefits.
Anti-spam check. Do
not
fill this in!
==Summary== '''Source of opportunity''' Snap is a venture stage investment in the public markets, something unseen in recent years where nearly all internet companies waited until later stages of growth and profitability to go public. While this clearly carries a higher risk profile, we believe it also comes with higher reward potential. With Snap’s large, valuable, and highly engaged user base generating ad inventory and the monetization path in mobile now well worn, we believe the potential for outperformance as the company continues to innovate against the growing mobile opportunity outweighs those early stage risks. Therefore, we initiate coverage with a Buy rating. '''Catalyst''' '''User Engagement:''' Snap’s 158mn daily active users are highly engaged visiting the site 18 times daily for an aggregate 30 mins. While DAU growth decelerated materially in 2H16 (15mn net adds vs. 36mn in 1H16), we see early signs of reacceleration in comScore data (MAUs increased 18mn in 4Q16 vs. 12mn in 3Q16), despite increasing competition from larger social platforms. This remains the biggest risk to Snap’s future, in our opinion. Monetization. While extremely early stage, particularly in developing the critical targeting and measurement technologies expected by mobile advertisers, Snap’s high value audience and the engaging advertising inventory they create should allow the company to monetize similar to other platforms over time. '''Valuation''' Our $9, 12-month price target is based on 18x 2018E EV/Sales, a slight premium to peers on a growth-adjusted basis, given our expectation for sustained hyper growth and potential upside risk to our estimates. Key risks include increased competition, volatility and unpredictability of key reported metrics like DAUs, execution risk given rapid expansion of workforce
Summary:
Please note that all contributions to Stockhub may be edited, altered, or removed by other contributors. If you do not want your writing to be edited mercilessly, then do not submit it here.
You are also promising us that you wrote this yourself, or copied it from a public domain or similar free resource (see
Stockhub:Copyrights
for details).
Do not submit copyrighted work without permission!
Cancel
Editing help
(opens in new window)