What Happened?
Shares of social network Snapchat (NYSE: SNAP) jumped 3.8% in the morning session after an analyst note from JMP Securities highlighted positive feedback from major marketers about the platform's performance.
JMP Securities maintained its Market Perform rating on the company, citing strong advertiser sentiment. For example, a performance marketing manager from Nike told the firm that Snap delivered the most incremental reach to younger consumers after Meta and Google. The manager also noted they did not hold Snap to the same return on ad spend requirements as other platforms due to this unique reach.
Furthermore, feedback from Spotify indicated that Sponsored Snaps were 'highly performant,' a success the music streamer attributed mainly to the 'very low' cost-per-thousand impressions (CPMs) for these ad units. This positive commentary followed the company's recent announcement of its new fifth-generation Spectacles and Snap OS 2.0.
After the initial pop the shares cooled down to $8.20, up 2.7% from previous close.
Is now the time to buy Snap? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Snap’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 21 hours ago when the stock gained 3.5% on the news that the stock's positive momentum continued as the company announced its new fifth-generation Spectacles and a new operating system, Snap OS 2.0.
This major software overhaul improved the experience on its current augmented-reality (AR) glasses, offering a faster and more user-friendly browser. The news created positive buzz and signaled progress toward the launch of Snap's first consumer smart glasses, which are expected next year. The Spectacles device was limited to developers. This jump in the stock price provided a welcome break for investors.
Snap is down 27% since the beginning of the year, and at $8.20 per share, it is trading 36.2% below its 52-week high of $12.86 from December 2024. Investors who bought $1,000 worth of Snap’s shares 5 years ago would now be looking at an investment worth $344.40.
Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link.