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Home / Business / Snap shares jump by upgrading the earnings after the clock

Snap shares jump by upgrading the earnings after the clock



Evan Spiegel, CEO and co-founder of Snap Inc.

Adam Galica | CNBC

Shares of Snap, the parent company of Snapchat, rose on Tuesday after an upgrade from Stifel prior to the company's earnings release after the clock.

Stifel upgraded Snap to buy from wait and raised its price target to $ 17 from $ 13. The company trades around $ 14 per share.

"Although 2Q: 19 could see noise related to a significant sales force reorg., We are increasingly optimistic about Snap's growth outlook in 2H: 1

9 and beyond," Stifel's John Egbert said in a note to clients Monday.

After a rough two years ago the first public offer in 2017, the Snap share is up nearly 160% this year, and traded near the debut price of $ 17 from March 2017. After spending most of last year under pressure when users and advertisers left Snapchat's platform left the company restructuring as it focuses on younger users, increasing efforts to increase reality and improve advertising business.

Snap shares traded more than 3% in trade with the premarket.

On the way into second quarter earnings, Egbert estimates that revenues will grow 37% from the year to $ 359 million, which is roughly in line with the Wall Street consensus estimate of $ 360 million and in high- than the Snap & # 39; s guidance area. Egbert said he believes Snap gave careful guidance because of the company's reorganization.

Egbert said that Snap, which has a market value of around $ 19 billion, has "overlooked" success in its advertising business. The technology company has switched to self-service advertising that reduces the cost of advertisers; Egbert said, however, that the bid rates for Snap have shown signs of stabilization.

Egbert also said he would listen to the revenue call for Snap's newly launched Android redesign, which has seemed to have a positive impact on user growth.

– with reporting from CNBC's Michael Bloom


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