In a report released yesterday, James Heaney CFA from Jefferies maintained a Buy rating on Snap (SNAP – Research Report), with a price target of $15.00.
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James Heaney CFA has given his Buy rating due to a combination of factors that reflect Snap’s robust performance and promising outlook. The company’s revenue growth in Q4 was impressive, reaching the higher end of expectations with a year-over-year increase of 14%, while Q1 guidance was optimistic, projecting growth of around 12.5% despite challenging comparisons. This positive outlook is supported by strong performance in the direct response (DR) advertising segment, which maintained healthy growth and contributed significantly to the overall revenue.
Additionally, Snap’s operational efficiency has been commendable, as evidenced by an 11% beat in Q4 EBITDA and an 18% margin, reflecting effective cost management. The introduction of new products, such as the smart budget optimization tool, is expected to further drive growth, particularly in the DR segment. Despite some challenges with the Simple Snapchat product among highly engaged users, the overall trajectory for Snap remains favorable, justifying the Buy recommendation.
In another report released today, JMP Securities also maintained a Buy rating on the stock with a $16.00 price target.