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Snap Rises as Goldman Praises Product, Monetization Efforts

Investing.com – Snap rose on Friday after Goldman Sachs upgraded its outlook on the social media company on expectations that efforts to improve its product and money-making approach would deliver growth.

Goldman Sachs upgraded its rating on Snap (NYSE:SNAP) to buy from neutral, sending the company’s share price nearly 1% higher.

“(W)e believe product improvements and feature additions are driving positive trends in user growth and engagement that, along with monetization improvement from ad tech initiatives, should drive upside to consensus estimates,” Goldman said in a note to clients.

Snap has been gaining favor among analysts after its user growth rebounded in the first quarter of the year as the company launched a revamped Android-based app earlier this year to bring the performance of the Android version up to par with the iOS app.

Bank of America Merrill Lynch) on Thursday raised its price target on Snap to $17 per share from $12 a share, citing third-party data showing second-quarter downloads were “near record levels.”

The bank also admitted that it had “underestimated the potential rebound in [Snap] user activity in 2019,” amid fears over competition from Instagram and execution challenges.

“Overall we anticipate improving user trends and revenue upside in 2Q, though we expect Snap to remain conservative in its outlook,” the bank said.

Snap, whose shares have rallied 71% year to date, is expected to report earnings on July 23, after market close.

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