Shares of Snap (SNAP) soared as much as 10% on Tuesday after BTIG media and tech analyst Richard Greenfield raised his price target to a street-high of $20 from $15 on the belief that the company's recovery has meaningfully increased since March.
“Here’s a company investors generally left for dead. They didn’t think this company was going to turn around. They thought Facebook had effectively put a fork in them and killed them. And the reality is, this thing is not dead,” Greenfield told The Final Round in an interview.
Greenfield cites several reasons why the stock still has room to grow, including the launch of new ad products to accelerate monetization, continued clean up of the Discover section, and increased use of gaming on Snapchat. Also of importance is Snapchat's more open approach to third-parties, which he says is boosting engagement.
BTIG maintained its buy rating on the stock, which is premised on accelerating user growth and monetization.
“We think monetization is accelerating. We think they're doing very well in bringing in performance advertising. They're out this week in Cannes selling brand advertising. They're trying to copy what Google Preferred has done by creating Snap Select,” he noted.
According to the company, Snap Select features premium video content in the form of top shows, commercials and reservations. Media partners include NBCUniversal, ESPN and the NFL.
Snap, Inc. is expected to report quarterly results on August 6. Shares are up nearly 170% for the year as of Tuesday’s close.
Pamela Granda is a producer on Yahoo Finance’s closing bell show, The Final Round. Follow her on Twitter.