Technology

Credit Suisse, Other Analysts Boost Targets on Snap After Earnings

Paul Ausick

Published: July 23, 2021 10:55 am

Snap Inc. (NYSE: SNAP) reported second-quarter earnings late Thursday that shattered expectations. The stock opened Friday morning’s trading session up more than 20%.

The company’s quarterly revenue came in 16% above the consensus estimate and 17% above Snap’s own estimated range for the quarter. Strong advertising demand in North America gave Snap pricing power and the company used it to maximum effect.

Several banks and investment management firms had comments on Snap’s outstanding performance. Here’s a summary of the comments seen Friday morning, along with other ratings or price target changes.

Credit Suisse maintained its Outperform rating on Snap and raised its price target from $90 to $110. Reported daily active users (DAUs) of 293 million was slightly ahead of the bank’s estimate for 292 million DAUs. Credit Suisse raised its estimates for 2021 and 2022 adjusted earning per share from $0.03 and $0.46, respectively, to $0.22 and $0.58.

Cowen reiterated its Outperform rating on the stock and raised its price target from $90 to $96 a share. Snap reported “monster” results and revenue guidance for the current (third) quarter was above Cowen’s pre-report estimate.

JMP Securities reiterated its Market Outperform rating on the stock and raised its price target from $89 to $94. The firm’s analyst specifically noted North American earnings before interest, taxes, depreciation, and amortization (EBITDA) of $117 million compared to prior guidance in a range of a loss of $20 million to breakeven for the quarter.

KeyBanc reiterated its Overweight rating on the stock and raised its price target $88, citing the bank’s 22.5 multiple to Snap’s estimated enterprise value-to-sales ratio. KeyBanc also said that the second-quarter results raise confidence in Snap’s ability to sustain growth of approximately 50% over the medium term.

Loop Capital maintained both its Buy rating on the stock and its $78 price target. The firm pointed out that second-quarter revenue rose by 91% year over year to $982 million.

Other ratings or price target action:

• Barclay’s raised its rating from Positive to Overweight and lifted its price target from $75 to $81.
• Canaccord Genuity maintained its Hold rating on the stock and raised the price target from $76 to $80.
• Jefferies maintained a Buy rating and raised its price target from $81 to $90.
• Morgan Stanley upgraded its Positive rating to Overweight and lifted its target from $75 to $85.
• Truist Securities maintained its Buy rating and raised its price target from $85 to $100.
• UBS maintained a Buy rating and raised its price target from $85 to $92.

Snap’s stock traded up almost 22% at $76.85 in the first hour of trading on Friday. The stock’s 52-week trading range is $20.61 to $78.68, a level reached early in the morning. The prior consensus price target was $77.12.