Reuters
- Snapchat’s parent company Snap Inc. will rise 45% as its product development grows faster than expected, Goldman Sachs said in a note on Monday.
- Goldman reiterates its buy rating on Snap shares and sets a price target of $ 7o for the company.
- Goldman’s note helped drive an 11% rise in Snap shares in Tuesday’s trades.
- Watch Snap trading live here.
Snapchat parent Snap Inc. has enough space if the analysis of Goldman Sachs is correct.
In a note Monday, Goldman reiterated its Buy rating on Snap and set a price target of $ 70, representing a potential 45% increase by the end of Monday.
The note helped boost Snap shares to 11% in trading.
Goldman believes that recent Snap initiatives, including a number of technological innovations and product partnerships, combined with a favorable macro background for online advertising, “will increase the likelihood of accelerating revenue growth beyond the consensus forecasts in Q4 and beyond,” according to the note.
Snap is expanding its advertiser base and user engagement on its sharing platform continues to grow, Goldman noted.
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“Snap’s Spotlight product, new goals and advertising campaigns for advertising and the Unity partnership have the potential to promote further growth in engagement, and offer advertisers valuable scale,” Goldman said.
Furthermore, Goldman’s channel control suggests that Snap will be able to exceed its own growth forecasts.
“Our investigations with advertisers, as well as recent information about third parties, indicate that the strength of brands and direct responses will continue into the holiday season, despite uncertainty surrounding the impact of the November election and the revival of COVID – related locks, which the potential of the 47% -50% y / y growth that management noticed was achievable if the holiday season materializes in line with previous years, “Goldman explained.
“We now expect a 58% year-on-year revenue growth, reflecting the strength,” Goldman added.
Shares in Snap rose 196% to date with the close on Thursday.
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