Snap Inc (SNAP) PT Lowered to $6.50 at MoffettNathanson; 'Quickly Running out of Money'
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MoffettNathanson analyst Michael Nathanson lowered the price target on Snap Inc (NYSE: SNAP) to $6.50 (from $8.00) while maintaining a Neutral rating. Nathanson said the company is "quickly running out of money". The firm's math suggests a capital raise is needed in the middle to end of 2019.
Commenting on CEO Evan Spiegel’s internal memo that outlined a 2019 goal of accelerating revenue growth and achieving full-year positive free cash flow and profitability, Nathanson said they are "skeptical" and they "don’t have faith in Snap’s leadership to navigate these rapids."
Given that they anticipate slower DAU and ARPU growth ahead, they are lowering our revenue estimates by -7% in 2019 and -15% in 2020.
While the firm is negative on SNAP, they believe the easy money on the short side has been made from the IPO to today and think that Twitter (NYSE: TWTR) represents a better “sell” opportunity.
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