Jefferies Upgrades Snap Inc (SNAP) to Buy, 'well positioned to deliver 15% rev growth'

Jefferies analyst James Heaney upgraded Snap Inc (NYSE: SNAP) from Hold to Buy with a price target of $16.00 (from $12.00).

The analyst comments "Rationale for Upgrade: We believe the worst of SNAP's headwinds are behind them, and we see a pathway back to a mid-teens rev CAGR over the next 3-5 years. In our view, much of SNAP's underperformance came from the rebuild of the direct response (DR) ad platform, which drove declining rev for the first time ever in Q1 and Q2 of this year. However, we now see evidence that the DR platform is beginning to positively inflect. Beyond the improvements to the DR platform, we see additional upside revenue drivers including the deeper Amazon ads integration and potentially other retail integrations, growing Snapchat+ contribution, and expansion of brand advertising products. As a result, we are raising our FY24 and FY25 rev ests by 3% and are now 3% and 5% ahead of street, respectively. In our view, SNAP is well positioned to deliver 15% rev growth in FY24, which is a significant acceleration from ~0% in FY23. We are raising our PT to $16 (from $12), which implies 5.3x our FY24 rev estimate."

For an analyst ratings summary and ratings history on Snap Inc click here. For more ratings news on Snap Inc click here.

Shares of Snap Inc closed at $12.98 yesterday.

You May Also Be Interested In

• Craig-Hallum Upgrades Backblaze Inc (BLZE) to Buy
• Norwegian Cruise (NCLH) PT Raised to $24 at TD Cowen
• Ares Management, L.P. (ARES) PT Raised to $153 at TD Cowen