Snap Inc. (NYSE: SNAP) has been a big question mark for Wall Street, and since shares bottomed late this summer there seem to be more questions than answers. A good barometer of investor sentiment is short interest, and Snap is seeing a big swing there.
Short interest in its shares rose by about 13 million to 121.13 million in total for the two-week period that ended October 13. The figure is an extremely high 25% of Snap’s float.
Snap has been facing increased competition from Facebook’s Instagram, cramping the space.
Instagram now claims 800 million monthly active users, according to a report in the New York Post. When Snapchat presented results last month, it reported 173 million monthly active users.
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It gets worse. Instagram’s stories feature now claims 250 million monthly users, about 45% bigger than all Snapchat’s users. Facebook executive Carolyn Everson also told the Advertising Week conference in New York that Instagram now has more than 500 million daily users.
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Instagram isn’t the only problem that Snap is facing, but it’s a big one. Considering this, among other issues that Snap has been facing, investor sentiment seems to be taking a more negative tone as short interest rises.
Shares of Snap traded up q.5% at $14.81 early Wednesday, with a consensus analyst price target of $14.78 and a 52-week range of $11.28 to $29.44.
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