Snap: Bullish Trading Won't Last
Snap (SNAP) is back above $6 in early trading despite a price target cut from Pivotal Research. Even at $6, Snap still has a market cap of $9 billion.
-Pivotal Research has downgraded its take on Snap (NYSE:SNAP) to Hold from a previous Buy.
-Pivotal Research has downgraded its take on Snap (NYSE:SNAP) to Hold from a previous Buy.
Analyst Brian Wieser has cut his price target to $6 from $8.
The stock has had a positive bounce off the $4.82 low. Any trade over $6 provides an opportunity for a bullish trade.
The risk here is that bulls remain irrationally bullish. The company had negative FCF of $159 million last quarter and user questions remain. For the stock to ever become investable, Snap needs to prune FCF losses to minimal amount and provide a legitimate path to profitable user growth.
More research: Snap: Death Spiral
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