|Bid||15.09 x 1200|
|Ask||15.12 x 1200|
|Day's Range||14.58 - 15.19|
|52 Week Range||4.82 - 18.36|
|Beta (5Y Monthly)||1.08|
|PE Ratio (TTM)||N/A|
|Earnings Date||Feb 3, 2020 - Feb 7, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||18.01|
Fresh on the heels of news that Larry Page will resign from his role as Alphabet's CEO, Yahoo Finance's Editor-in-Chief Andy Serwer joins The Final Round to discuss how technology has shaped the past decade.
Snap stock is trading higher after JMP Securities boosted its rating on the social networking company’s shares.
Social media company Snap Inc (NYSE: SNAP ) is more "stable" today than it was a year ago, according to JMP Securities. and investors should be buyers of the stock, according to JMP. The Analyst ...
Snap Inc. shares are up 1.8% in morning trading Friday after JMP Securities analyst Ron Josey upgraded the stock to outperform from market perform. He's upbeat about the company's potential to grow users and leverage newer features to boost engagement. "Importantly, we believe that the organization is now more stable than it was when entering 2019, and as we look into 2020, we believe Snap is well positioned to continue to add [daily active users] and close the monetization gap with other major social networks as its sales force reorg is now behind it and the company launches new and innovative advertising products," Josey wrote. On the advertising front, he sees the company winning a greater share of budgets. Snap shares are up 168% so far this year, as the S&P 500 has increased 26%.
(Bloomberg) -- So much for keeping up with the day-to-day lurches from crisis to crisis. Somehow we always knew it was going to come down to the wire -- otherwise, where’s the leverage?But let’s be clear -- the agreed upon trade “deal” as it’s already become known, is just Phase One, and for the most part, avoids the fresh tariffs that were due to go into effect this Sunday (the legal text is still in process). They would have impacted made-in-China smartphones, toys, tablets and laptops -- shares of Mattel (MAT) are among the winners this morning, up nearly 3% pre-market, extending a 4.4% regular session performance Thursday (watch HAS as well). Apple shares, too, are narrowly outpacing futures, up 0.4% vs the broader S&P which looks to notch another 11 handles on to its all-time highs set yesterday.Are we out of the woods? It’s unclear at this stage, but Chinese foreign minister Wang Yi said earlier today that the skirmishes in this trade battle have “severely damaged the hard-earned basis for mutual trust.” Whether those comments themselves are a negotiating tactic for future engagement is a topic outside my pay grade. That future engagement, however, now turns to finding a way to lower existing tariff rates by as much as half, Bloomberg reports.The moves in stocks started well before reports indicated Trump was to sign off on the deal. A tweet right after the market open (whereby Trump said a “big deal” was close), followed by a WSJ item set the wheels in motion, and the rising tide lifted most boats (76% of the S&P gained, while defensives lagged), even those previously capsized. Momentum as a factor was sucking wind as the lofty market heights (all-time highs were set) failed to benefit some of the best performers over the past 12 months, instead leading value and those that have struggled to benefit.As an example of the diverging fortunes, of the top 50 performers in the Russell 3000 Thursday, only 9 had positive equity returns over the prior 12 months. That means more than 80% of the top names yesterday had been negative over a period in which the index the itself was on track to have a stellar year, up nearly 19%.Will that repeat itself? Today will undoubtedly be dominated by similar forces, with a closer look at sentiment and where talks go from here. You do have the U.K election to consider, after all, which finally achieved some certainty with a resounding victory for Boris Johnson. An assured Brexit is still unclear, but the overall political uncertainty has diminished. An equity screen of U.S.-traded names domiciled in the U.K. and/or have revenue exposure in excess of 20% of their total (given the British pound spike) can be found in the below chart.Other aspects of the trade agreement (beyond just tech, toys) must also be weighed, as growth prospects have risen, boosting treasury yields (watch banks and financials, even as the S5FINL exceeded its pre-financial crisis highs for the first time yesterday), commodity-exposed stocks (X, FCX, LIN) and crude (oil servicers like FTI, SLB are higher by nearly 1% in the premarket). Semiconductors and tech (MRVL, ON, AMD, MU, QCOM, NVDA) should also be strong.On Tap for Next WeekThe last full trading week of 2019, if all things stay copacetic on the trade front, should be less frenetic than what we saw this week and almost assuredly less so than Thursday.What will make it interesting is that the earnings docket includes some names that are multinational in scope, to a degree that they may provide nice context into tariff impacts (and what may have been dodged).FedEx in particular, as singled out in last Tuesday’s Taking Stock, was particularly sensitive to any worsening of U.S.-Sino relations, given that its name was floated as a potential target for China’s “unreliable entities” list. The air-freight company Thursday staged one of the larger rallies in the S&P following reports that a deal in principle with China had been reached. It also benefited from an upgrade at UBS, which cited no imminent catalysts to the downside. The company should also have an outlook for how the Christmas season and shipments will unfold. Interestingly, despite the challenges this year (-12% over the past twelve months), the Street has yet to throw in the towel. Sell ratings are few and far between, with just as many on the Street recommending to buy the shares as hold them, according to data compiled by Bloomberg.Micron, Nike and Jabil too, should have an opinion on the trade detente (if we can call it that at this stage), given their reliance on international markets for material percentages of revenues (JBL attributes 53% of its revenue to Asia).From the consumer standpoint, we’ll see results from Carmax and Winnebago, two sectors that have seen diverging outcomes off late. The auto dealer is near highs after a series of positive earnings reports and its potential to disrupt the used-car dealership model, Morgan Stanley analysts wrote in September (shares are about a 1% from their all-time highs). The RV retailer, however, is still 20% off its 2017 highs, while earlier this month analysts warned about shipment declines in the sector.Notes From the Sell SideCredit Suisse is out with a broad call on biotech stocks, upgrading both Biogen and Regeneron but lowering its view on Gilead. Biogen was raised to neutral, with the firm citing positive feedback from physicians about aducanumab. “While we think the data is challenging, we also believe that broader desire for an approved Alzheimer’s drug could help adu. cross the FDA finish line.”Regeneron’s upgrade to outperform comes after “reports of Eylea’s demise are somewhat exaggerated.” Execution on this front, “layered with progress in the novel oncology platform will drive outsized outperformance” in 2020 compared with peers.On the downside, Gilead was cut to underperform as the setup for 2020 “remains challenging with an unclear strategy from the new management team.” Credit Suisse noted concerns over earnings and revenue growth. Neurocine and Galapagos were also downgraded at Credit Suisse, with the rating on both dropping to neutral.Outside the biotech space, Snap was upgraded to market outperform as JMP Securities has higher confidence in the social-media company’s ability to grow its user base and improve monetization in 2020.The Snapchat parent “is well positioned to continue to add [daily active users] and close the monetization gap with other major social networks,” thanks to the launch of new advertising products, as well as a reorganization of the sales force. Improved reach, user engagement, and execution “should lead to continued revenue growth and improving overall profitability.”Shares are up 2% in pre-market trading; the stock has jumped more than 150% from a January Low. Analyst Ronald Josey noted that the valuation was “among the most expensive in our coverage universe.”The move represents just the latest sign of improved sentiment surrounding Snap. Since the start of October, Snap has received upgrades from Morgan Stanley, BofA, JPMorgan, Needham, and Loop Capital, according to data compiled by Bloomberg.Sectors in FocusBroadcom results picked a poor day to underperform while the rest of the space rises after the trade agreement. Watch suppliers like FLEX, AMKR, FNSR, CDNS for a drag that may not have otherwise occuredSaaS names after Oracle’s weak forecast sent shares lower by more than 2%. Its 2Q revenue also missed expectationsAdobe beat analyst expectations, prompting a series of bullish analyst commentary. Watch ANSS, CRM, CDNS SNPSTrade-war related names (CAT, BA, GE, FDX, WYNN, LRCX, NKE, LVS, A)Tick-By-Tick to Today’s Actionable EventsPresident’s Cup play continues. America versus the World (ex. Europe)8:30am -- November Import Price Index 8:30am8:30am -- November Retail Sales 8:30am8:30am -- AGCO analyst meeting9:45am -- Bloomberg December U.S. Economic Survey 9:45am10:00am -- October Business Inventories11:00am -- Fed’s Williams discusses topics in monetary policy\--With assistance from Ryan Vlastelica.To contact the reporter on this story: Brad Olesen in New York at email@example.comTo contact the editors responsible for this story: Courtney Dentch at firstname.lastname@example.org, Brad OlesenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Analyst Ronald Josey pegs price target at $20, nearly 40% above Thursday close. More users and better execution should equal more revenue and profit, he says.
Computer chipmaker Nvidia (NASDAQ:NVDA) has handsomely rewarded investors who bought the company's stock after last fall's calamitous drop.Source: JHVEPhoto / Shutterstock.com Since bottoming out last December, Nvidia stock is up more than 70%. The question is, trading at around $220 now, does NVDA still have significant upside? Or are investors looking to get in on a high growth technology stock better off looking elsewhere? Two Growth Spurts in 12 Months for Nvidia StockAs mentioned, NVDA has posted more than 70% growth since late last December. For 2019, it's almost as impressive at 66% growth so far. However, those big numbers don't tell the full story.InvestorPlace - Stock Market News, Stock Advice & Trading TipsLooking at the performance of Nvidia stock over the past 12 months, there are two distinct periods where the stock suffered a rapid drop; then rallied. Factors outside of Nvidia's control triggered both of those events. * The 10 Worst Dividend Stocks of the Decade And while the biggest isn't likely to repeat any time soon, the second -- which took place this spring -- is not only still in play, it could have an even larger impact in the future. The Crypto BustThe sudden collapse of the cryptocurrency market last fall rocked Nvidia stock. The company had been churning out graphics cards as fast as it could make them. They were trying to feed the insatiable demand of cryptocurrency miners, who used the cards in their high-powered rigs.When the bottom fell out of that market, the miners' demand for graphics cards collapsed. Nvidia and its rival Advanced Micro Devices (NASDAQ:AMD) still had their core business, but the crypto "mad money" disappeared almost instantly.Nvida stock dropped like a rock as a result. After sitting at around $281 in late September 2018, it hit $129.57 on Dec. 21.That precipitous drop set the stage for a rally that has lasted for the past year. However, that recovery was interrupted in the spring -- once again by outside forces. The Trade War Between the U.S. and ChinaLike many American tech companies, Nvidia has been affected by the trade war between the U.S. and China.During the spring, tensions rose. The U.S. raised tariffs on $200 billion worth of Chinese goods, imposed a new round of tariffs and China retaliated by threatening to cancel trade talks. With concerns that the escalating trade war would hit NVDA hard, Nvidia stock dropped nearly 25% during the month of May. Are There Other Tech Stocks with Better Growth Prospects?Analysts like Nvidia stock. Among those polled by CNN Business, NVDA is a consensus "buy" and their median 12-month price target for the stock is $240 -- representing a healthy 9% increase from the current price.Healthy, but not not poised for the kind of growth NVDA stock has posted over the past 12 months. If NVDA is expected to have relatively modest upside for the next 12 months, are there other tech stocks that might be on track for bigger gains? Checking with CNN Business, its investment analysts see around 24% upside for e-commerce giant Amazon (NASDAQ:AMZN) over the next 12 months, an upside of 15% for chipmaker Micron (NASDAQ:MU), over 19% upside for Facebook (NASDAQ:FB) and 27% in 12-month upside for Snap (NYSE:SNAP).Nvidia may be a consensus buy, but you definitely have alternatives if you're looking for tech stocks with better odds of big gains over the next year. Bottom Line for Nvidia StockNVDA is a relatively safe bet, with analysts looking for single-digit upside over the next 12 months. It's in a dogfight with rival AMD over PC graphic card sales, but the company's long-term dominance of that core business isn't in any immediate danger. The crypto market has yet to recover and begin buying graphics cards again, so that variable is out of the mix. Therefore, there will not be a repeat of last year's crash.The trade war with China remains a risk for NVDA, but unless things spiral completely out of control, Nvidia stock has shown it can quickly bounce back from the frequent sparring between the two countries.It may not offer the prospect of the spectacular growth shown over the past 12 months, but for the next 12 months, NVDA looks to be a solid and safe investment.As of this writing, Brad Moon did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Worst Dividend Stocks of the Decade * 7 Game-Changing Tech Stocks to Buy Now * 5 Chinese Stocks to Buy for the Big 2020 Rebound The post Nvidia Stock: Good Buy Despite Modest 2020 Upside? appeared first on InvestorPlace.
By the numbers, Facebook (NASDAQ:FB) stock looks far too cheap. Its 2019 earnings per share, excluding a settlement with the Federal Trade Commission, should come in over $8 per share. Back its out over $18 per share of cash, and Facebook stock is trading at something like 22 tines this year's earnings.Source: justplay1412 / Shutterstock.com That's basically the market's average multiple. Yet Facebook is growing much faster than the market. Its revenue should rise 26% this year and at least 20% in 2020.Indeed, there is no shortage of tech stocks with lower growth and substantially higher valuations. Microsoft (NASDAQ:MSFT) is one. Smaller names like Intuit (NASDAQ:INTU) and Adobe (NASDAQ:ADBE) might qualify as well. Simply considering growth and valuation, there are few better stocks out there than Facebook stock.InvestorPlace - Stock Market News, Stock Advice & Trading TipsTo some extent, investors have come around to that realization. FB stock has gained 53% so far this year. But its shares also trade below their July peak -- and they haven't returned to the all-time highs they reached in 2018.There are reasons for that, and Facebook stock faces real risks going forward. One of those risks became quickly and stunningly apparent last year.I've argued for much of this year that Facebook stock was too cheap. But with Facebook stock price back at $200, the outlook of FB stock is increasingly dependent on the extent to which Facebook can avoid, or at least mitigate, those risks. * The 10 Worst Dividend Stocks of the Decade Will FB's Spending Slow?The biggest hit to Facebook stock ever came last July. In fact, it was the biggest hit to any stock ever. On Jul. 26, 2018, Facebook's market capitalization fell a staggering $119 billion in a single trading session. The decline easily eclipsed one-day losses during the dot-com bubble-era by Intel (NASDAQ:INTC) and Microsoft.The catalyst was a statement FB made on its earnings conference call, Facebook said its operating expenses would rise meaningfully in 2019. That guidance mostly has come to pass: excluding the FTC settlement, total costs and expenses have risen 35% so far this year, while FB's revenue has climbed just 27%. Facebook stock price may not fully reflect this news.After Q3, Facebook said its expenses would rise rather sharply again. Its total expenses are expected to increase to $54 billion to $59 billion in 2020 from $41 billion to $43 billion in 2019 (again, excluding the FTC settlement).At the midpoints, that's a 35% increase -- roughly equivalent to the percentage increase through the first three quarters of 2019 . And the guidance suggests that the company's margins will further compress in 2020, resulting in relatively lower profit growth.But this time around, the market has shrugged at the guidance. One key reason for that might be that analysts don't believe the company. The Street appears to think that Facebook is being conservative about 2020.Those analysts probably need to be right for Facebook stock price to reach new highs. The concerns about its margin compression are legitimate; Facebook's spending on security and user safety isn't going to slow. To drive the earnings growth needed to move Facebook stock higher, the company needs to be able to cut its other costs. Are Regulators Coming?Another obvious risk is on the regulatory front. The FTC already has fined Facebook $5 billion. One FTC commissioner said this week the settlement didn't go far enough.Regulators in Europe are watching both Facebook and Alphabet (NASDAQ:GOOG,NASDAQ:GOOGL) closely. Federal antitrust authorities in the U.S. have opened their own investigations, as have state attorneys general.So far, political risk has been mostly much ado about nothing for Facebook stock. Both the June revelation of the federal antitrust probes and the drama surrounding the company's Cambridge Analytica scandal simply created buying opportunities. The $5 billion fine is less than 1% of Facebook's market capitalization.For now, political risk still seems relatively minimal. A federal government that can't agree on anything seems unlikely to agree on how to manage Facebook. The step of actually separating the company from its WhatsApp and Instagram businesses seems extreme and to require more political capital than it's worth.Many Americans are outraged at Big Tech, but there's little evidence yet that politicians have the stomach for a years-long legal battle that would likely dwarf the infamous Microsoft antitrust case that took nearly a decade to resolve.Still, recent trading shows that any kind of news on the regulatory front can move Facebook and other internet stocks. And with the 2020 elections less than a year away, Facebook, Google, and Twitter (NYSE:TWTR) likely will be in the headlines, and in candidates' statements, much more often than they would like. User Growth and Facebook StockOne potential irony surrounding FB stock is that the most widely-discussed risk hasn't played out. For years, skeptics have worried that Facebook's user growth was going to slow. Reports of teenage users fleeing the platform to escape their parents have persisted for years. Snap Inc (NYSE:SNAP) platform Snapchat was highlighted as a potentially legitimate competitor.The Cambridge Analytica revelations supposedly turned off users. Conservatives in the West see bias on the platform; liberals decry the spread of "fake news" on FB. For years now, it's seemed like multiple demographics were on the verge of exiting Facebook for good, and, for some time, that exodus was seen as a key risk to the stock.It simply hasn't happened. Facebook's daily active users (DAUs) increased 9% year-over-year in Q3, to a stunning 1.62 billion. Facebook wrote in its Q3 earnings press release that an estimated 2.2 billion people use at least one of the company's four services (Facebook, Instagram, WhatsApp, and Messenger) each day. That's nearly 40% of the world's adult population; excluding China, its daily penetration rate is almost 50%.That said, slowing user growth could be a risk going forward, particularly if the trend is combined with higher spending. In the West, Facebook's DAU numbers have stagnated. The daily active user base in the U.S. and Canada increased just 2% year-over-year in Q3; DAU growth in Europe was just 3.5% YoY. Elsewhere, the platform's reach is expanding, but a ceiling might loom.Competitive fears do seem markedly lower. Snapchat's user growth has started to rise again, but its DAU base is barely one-eighth that of Facebook. Twitter has evolved into a different tyoe of platform. Still, lower user growth will lead to lower revenue growth. It's possible that at least some of those who were skeptical about Facebook stock weren't wrong, but just early. The Case for FB StockWith FB stock back at $200, the bull/bear argument comes down to the risks outlined above. If Facebook stays on a relatively "normal" path, with its revenue and spending growth decelerating as the company matures, Facebook stock will likely outperform the market. The company has too much cash and generates too much cash to be trading at a market-level valuation. At the moment, from a financial perspective, FB is one of the best businesses in the world, with operating margins near 40% and revenue growth above 20%.The key qualifier there, however, is "at the moment." The world changes quickly, and the volatility of social media stocks shows the industry isn't immune to changes. Regulators can be fickle. Customers can be unpredictable. I still believe that Facebook stock is worth buying, despite these risks. But the risks are real -- and the owners of FB stock should keep that in mind.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Worst Dividend Stocks of the Decade * 7 Game-Changing Tech Stocks to Buy Now * 5 Chinese Stocks to Buy for the Big 2020 Rebound The post The Fate of Facebook Stock Will Come Down to Its Risks appeared first on InvestorPlace.
Third quarter earnings season boosted U.S. stocks. Broad market indices reached all-time highs and kept gaining until a modest speed bump in recent sessions. But not every stock participated in the rally.Indeed, several well-known names stumbled badly after their third-quarter reports, including Home Depot (NYSE:HD) and Yum! Brands (NYSE:YUM). But the news was even worse for the biggest earnings losers in the third quarter. * 10 Best-Performing Growth Stocks of the 2010s These three stocks aren't necessarily the stocks that saw the biggest decline after earnings, though one of them is. But for all three companies, third-quarter earnings materially and negatively changed the long-term outlook. Intrepid investors may look to buy the dip -- but after these reports, significant caution is advised.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Party City (PRTY)Source: Shutterstock Among stocks with a market capitalization above $100 million, Party City (NYSE:PRTY) appears to have posted the largest post-earnings decline after Q3. PRTY stock fell a stunning 67% in a single session after posting a surprise loss and cutting its full-year outlook for the second time.There is an intriguing case to step into the decline. Party City stock looks ridiculously cheap at roughly 2x -- yes, just two times -- its earnings per share guidance for 2019. A helium shortage has limited Party City's sales, taking 210 basis points off same-store sales in the third quarter. Brick-and-mortar retail is a fraught business at the moment, but Party City does sell through Amazon (NASDAQ:AMZN) and e-commerce competition in its vertical would seem to be limited.Investors haven't bought the dip, however: PRTY stock actually is down another 12% from its post-earnings close. And there are significant risks. Most notably, Party City has a potentially dangerous debt load of just over $2 billion. That's more than 6x the company's guided Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) -- a dangerously high multiple.And that debt colors the story here. Retailer Michaels Companies (NASDAQ:MIK) too trades below 3x forward earnings -- with a lighter, if still risky, debt load. Investors have shown in recent years that they don't trust retailers in general, and particularly those with debt concerns. Party City has a long road ahead to change that opinion. Pinterest (PINS)Source: Nopparat Khokthong / Shutterstock.com Pinterest (NYSE:PINS) picked the wrong time to provide disappointing guidance. As growth stocks generally were struggling in late October, the company missed Wall Street estimates for revenue and gave a below-expected outlook.PINS stock already had declined heading into the report amid valuation concerns. It dropped another 17% after earnings, and the pressure has continued. Pinterest stock sits near its all-time low, and now trades below its initial public offering price of $19.Here, too, there's a case for stepping in, as Will Ashworth argued last month. Pinterest still is posting impressive revenue growth. Adjusted EBITDA turned positive in the quarter. Q3 results don't necessarily look disastrous, but rather closer to modestly disappointing.And there are echoes of Snap (NYSE:SNAP) in the report. Slower U.S. user growth is a concern, as it was for Snap not long after its IPO. International monetization disappointed in the early going for both companies. In the Q3 release, Pinterest's CEO cited a redesign of the site and app in the quarter, akin to what Snap did back in 2017. SNAP stock would fall below its IPO price and keep falling. * 7 Energy Stocks That Are Still Worth Buying In 2020 Of course, in retrospect it seems like Snap's redesign was the right move all along, and SNAP stock has been one of the market's best in 2019. The concern here is that even if history repeats itself, PINS story looks like a 2020 story at best, and a falling knife in the meantime. Dollar Tree (DLTR)Source: digitalreflections / Shutterstock.com Dollar Tree (NASDAQ:DLTR), too, picked the wrong time for disappointing guidance, but for different reasons. While weak earnings and soft guidance made Dollar Tree one of the biggest earnings losers from Q3, its rivals were posting impressive numbers.Indeed, Dollar General (NYSE:DG) just this week beat analyst expectations and raised full-year guidance. Walmart (NYSE:WMT) posted a strong quarter. So did Target (NYSE:TGT). It certainly looks like consumer spending on the low-to-middle end of the spectrum is strong. It also appears that Dollar Tree is losing share.In that context, a 15% sell-off to a 2019 low hardly seems surprising. And while DLTR stock has posted a modest rally in recent sessions, this doesn't look like a "buy the dip" scenario. As tough as retail is at the moment, it seems safest to stick with the winners. And, at least for now, Dollar Tree doesn't look like one of those winners.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Best-Performing Growth Stocks of the 2010s * 10 Stocks With Little or No Debt to Own for the Next 50 Years * 5 Restaurant Stocks Dominating Holiday Season Foot Traffic The post 3 Earnings Losers From Q3 Reports appeared first on InvestorPlace.
Snapchat is preparing to launch a big new feature that uses your selfies to replace the faces of people in videos you can then share. Snapchat Cameos are an alternative to Bitmoji for quickly conveying an emotion, reaction or silly situation in Snapchat messages. Some French users received a test version of the feature today, as spotted by Snap enthusiast @Mtatsis.
Snapchat is becoming an increasingly popular platform for political advertising, as campaigns seek to target younger audiences and take advantage of the detailed user data the messaging app offers. The social media app, which is actively used by more than 200m people, has seen a jump in political advertising revenues in the past few months, according to figures from the Washington-based Center for Responsive Politics. This has been boosted in part, experts say, by Snapchat’s younger demographic of users.
The experimental short is just the sort of trippy experiment you'd expect from the director of "Kids," "Spring Breakers" and"Beach Bum."
If you like to follow Wall Street's smart money, Snap (NYSE:SNAP) should be on your radar. But for shrewder investors, the monthly view of the Snapchat stock price chart is where lasting proof of profits will be likely gleaned. Let me explain.Source: dennizn / Shutterstock.com Everyone knows social media giant Facebook (NASDAQ:FB). In fact, it's surprising when you come across someone that doesn't take an occasional scroll the platform's news feed. At a minimum you'd be hard-pressed to find an individual that hasn't at least considered opening an account.For the Gen X and Baby Boomer populations, along with Facebook's Instagram platform and possibly Twitter (NYSE:TWTR) or Pinterest (NYSE:PINS), that's likely where one's social media presence ends. But the social media buck doesn't stop there.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIn today's digital world there is another wildly popular way to express yourself. For younger Millennials and Gen Z, there is Snapchat. The photo-sharing app known for its short-lived, finite visible footprint and whose images disappear into the ether has been a sensation. And Wall Street is doing more than simply paying attention to SNAP stock price.Most recently, Snapchat stock has gained the interest of hedge fund muscle Two Sigma. This $60 billion quant-driven powerhouse has netted more than $15 billion for clients since opening shop in 2001. It's enough to put the firm on LCH Investments' list of most successful hedge funds. * 7 Retail Stocks to Buy That Dominated Thanksgiving Shopping Now Two Sigma is betting big on Snapchat stock. The company has amassed a position worth $87.3 million in SNAP shares. Put another way, Two Sigma owns 5,528,277 shares for an average cost of $15.79. The fund isn't alone in believing Snap's momentum can continue and drive shares higher either.Of 21 analysts rating SNAP stock at TipRanks, the consensus has shares pegged as a moderate buy. Perhaps more telling, the low price target of $14 represents downside risk of around 7%. At the same time, an average price target of $18.82 and range high of $24 a share compare favorably with 12-month return expectations of 25% and 60% respectively. Nice, right? Snapchat Stock Price Weekly ChartSource: Charts by TradingViewIf we're to believe what Wall Street is saying and doing, the future looks good for SNAP. And judging by Snapchat stock's monthly technical picture, that view is reinforced.Over the last several months, SNAP has broken firmly above its former downtrend. Gains of nearly 275% stymied by Snapchat stock's 50% retracement level have been digested in a healthy and quite common 31% correction. To say the least, supports for a rally look good.But it gets better.Since establishing October's bullish hammer pattern, shares have continued to consolidate inside the bottoming candlestick. A move through the high of November's smaller doji would indicate SNAP is beginning to reaffirm its strength and is ready to build another leg higher.For those in agreement, buying SNAP above $16 makes sense. My first target for taking profits would be $20. The combination of a nice round figure and challenge of the 62% level make it a nice spot to peel off some risk. Likewise, a move below November's low of $13.50 provides a smarter money investment, both off and on the price chart, in more than one way.Investment accounts under Christopher Tyler's management do not currently own positions in any securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. . For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Retail Stocks to Buy That Dominated Thanksgiving Shopping * 6 Manufacturing Stocks to Buy as the Economy Recovers * The 7 Best Cryptocurrencies to Buy as Blockchain Heats Up The post How to Follow the Money into Snapchat Stock appeared first on InvestorPlace.
(Bloomberg Opinion) -- I now have low expectations when Mark Zuckerberg writes a manifesto, gives a speech, grants media interviews or fields questions from lawmakers.In these settings, and particularly on questions about how the world should or does work, Facebook Inc.’s chief executive officer can seem over-rehearsed, scarily superficial, cravenly political, evasive — or all of the above. But in less-scripted moments, or when the world isn’t watching, Zuckerberg is often clear-eyed about where the internet is going and articulate about Facebook’s strategy. Fifteen years after Zuckerberg started Facebook in his college dorm room — maybe you’ve heard that story before? — that scary-smart version of Zuckerberg remains the internet executive I want to hear from the most. Don’t believe me?Check out the transcript the Verge published in October of two meetings between Zuckerberg and employees. Most of the attention focused on his forceful push back to Elizabeth Warren and others who want to break up Facebook. But I was more interested in Zuckerberg’s astute explanation of how TikTok, the short-video app from China’s Bytedance Inc., is a distilled, video-focused version of Instagram’s “explore” section. He is not wrong.With those employees, Zuckerberg also talked in more nuanced ways than he has in public about the novelty of a Chinese internet app gaining traction outside its home country, how Facebook was trying to copy elements of TikTok and why TikTok was vulnerable. This was the opposite of the thousand-yard-stare Zuckerberg the public sees in media interviews. This was Zuckerberg in his element as a skilled and confident internet diagnostician and tactician.That Zuckerberg may not be the likable Everyman who pets a calf, but I wish we got to see more of him. Repeatedly in Facebook’s quarterly earnings calls over the years, Zuckerberg has given moments of insight that distill Facebook’s playbook or explain what trends such as online video, the Snapchat app and the Pokemon Go mobile game show about the future of technology.You get a likewise incisive, perhaps cutthroat, version of Zuckerberg from reading Facebook internal emails that come out in occasional lawsuits or investigations. Those glimpses are of a ruthless and savvy executive trying to undermine rivals and devise partnerships that would make people more loyal to Facebook. You might read those selective disclosures and feel Zuckerberg is unethical and selling out people who use Facebook. You might be right. But he is also astute about what works on the internet and how to position Facebook for success.And if Facebook was the mystery bidder for wearable gadget company Fitbit Inc., Zuckerberg refused to get involved in a conventional corporate acquisition process and basically nagged Fitbit’s CEO to make a deal on his terms. It was kooky, and the CEO of the unidentified suitor seemed like a loose cannon, at least in the one-sided telling of this Fitbit securities document. It’s also true that Zuckerberg’s personal involvement and unconventional personal persuasion helped Facebook acquire Instagram, which likely added more value to Facebook than anything else the company did this decade. Look, even the savvy tactician Zuckerberg can be horribly wrong. He brushed off the effects of misinformation spreading on Facebook around the 2016 U.S. presidential election. He plunged his company rashly into live video, a feature that is rife with risks and one that has not taken over the internet as Zuckerberg once predicted.Maybe Zuckerberg is just like the rest of us. When he’s talking out of the glare of shouting members of Congress and engaging on topics he feels confident about, he’s like a different person. Today, though, more is expected. Leaders — particularly those like Zuckerberg whose products are so widely used and influential — are expected to be capable of thinking deeply about problems in the world, not only to devise clever product and business strategies.The people who lead large companies must play many roles: diplomat, policy maker, motivational captain of their employees and an assuring public face to customers. It’s a nearly impossible assignment, but that doesn’t mean we should lower the bar for these executives. A version of this column originally appeared in Bloomberg’s Fully Charged technology newsletter. You can sign up here.To contact the author of this story: Shira Ovide at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shira Ovide is a Bloomberg Opinion columnist covering technology. She previously was a reporter for the Wall Street Journal.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Snap Inc. (NYSE:SNAP) today unveiled Duck Duck by Harmony Korine, an experimental short film shot using Spectacles 3 to explore storytelling in 3D. Released November 2019, Spectacles 3 are equipped with dual HD cameras to capture three-dimensional photos and videos, unlocking the ability to transform Snaps with 3D Effects.
One phrase comes to mind when you think of hedge fund Two Sigma: quantitative powerhouse. Founded in 2001 by John Overdeck and David Siegel, the hedge fund startup has become a $60 billion quant shop that uses a technology-based approach to guide its investing strategy. Its innovative use of fields like machine learning and distributed computing has enticed a host of blue-chip clients as well as first-rate talent.Based on the $15.2 billion net gain generated for its investors in the last 18 years, Two Sigma earned a spot on LCH Investments’ annual list of the most successful hedge funds of all time. No wonder the Street’s focus locks in on Overdeck and Siegel when the fund makes a portfolio addition.Bearing this in mind, we wanted to take a closer look at 3 trending stocks the fund added to its basket of holdings. With the help of TipRanks’ Stock Screener tool, we discovered that all of these names are buy-rated and boast substantial upside potential (depends who you ask) from the current share price. Here’s the lowdown:Roku Inc. (ROKU)For those just tuning in to Roku now, the streaming player company has captured Wall Street’s attention with its massive 372% climb year-to-date. While some bears have pointed to the recent dip as a cause for concern, the bulls believe that Roku is charging full speed ahead.With this in mind, Two Sigma has initiated position in ROKU, snapping up 177,100 shares in Q3. This puts the value of the purchase at more than $18 million.Needham analyst Laura Martin cites accelerating subscription video on demand revenues as the key upside valuation driver for Roku in 2020, noting that this actually decreases the investment risk. Roku is the largest aggregator of ad-driven TV and film content, with Martin estimating it will report about $850 million of total advertising revenue in 2020.“The enormous amount of money at stake (ie, $70B/year vs the tiny amount OTT TV and film ad inventory) and the growing inability of brands to follow viewing behind a growing number of SVOD pay walls makes OTT ad units more valuable, especially the young wealthy viewers who are more likely to view streaming content,” the analyst explained.On top of this, Martin sees Roku as the primary beneficiary of new streaming services from Disney+, Apple+, Peacock/CMSCA and HBOMax/AT&T thanks to the 32 million U.S. connected-TV homes that make up its installed base. Based on all of the above, the five-star analyst kept her Buy rating, while boosting the price target to $200 (from $150). At this target, shares could rise 38% in the next twelve months. (To watch Martin’s track record, click here)Like Martin, Macquarie’s Tim Nollen has high hopes for Roku. “We believe connected TV (CTV) device usage and advertising growth will continue to rise exponentially, and Roku is in prime position to both drive and harness this,” he wrote in a note in which he maintained his bullish call and bumped up the price target to $170. (To watch Nollen’s track record, click here)Looking at the consensus breakdown, not everyone on the Street is on the same page as the analysts. The average 12-month price target on the stock stands at $148, which implies a modest 2% increase from its current price. This is based on 9 "buy," 2 "hold," and 2 "sell" ratings received in the last three months. (See Roku stock analysis on TipRanks)Facebook (FB)Overdeck and Siegel’s fund just upped the ante by snapping up 1,306,250 shares of Facebook with a value of over $232.6 million, increasing the holding by a whopping 711%.Indeed, when it comes to the social media giant, some analysts tell investors the outlook for 2020 plus the current attractive share price equals a Buy.Part of the bullish sentiment on Wall Street comes as a result of its advertising segment. In its third quarter, FB’s ad growth remained at more than 30%, with 2020 guidance landing in-line with investors’ expectations. Susquehanna’s Shyam Patil thinks that this target is achievable or even beatable as Instagram Stories monetization continues to scale and incremental growth drivers like Instagram Shopping as well as Explore begin to accelerate. The analyst puts his rating where his mouth is, reiterating a Positive rating alongside a price target of $245. (To watch Patil’s track record, click here)Like Patil, Morgan Stanley’s Brian Nowak is especially excited about user engagement as it creates a “layer cake of monetization."“Engagement creates monetization opportunities and FB continues to excel at innovative monetization. Looking ahead to ’20 and beyond, we remain bullish about the still untapped engagement/use cases to monetize including Instagram Explore, commerce across FB Marketplace and Instagram, product sponsorships, video and Instagram TV…and (over the long-term) messaging,” he explained. To this end, Nowak decided to stay with the bulls. According to the five-star analyst’s $250 price target, shares could surge 26% in the next twelve months. (To watch Nowak’s track record, click here)In general, other Wall Street analysts take a similar approach. With 28 Buys, 3 Holds and 1 Sell, the verdict is that Facebook is a Strong Buy. Its $236 average price target implies a potential twelve-month gain of 19%. (See Facebook stock analysis on TipRanks)Snap Inc. (SNAP)The company behind the famous photo-sharing app has certainly impressed Wall Street with its 171% year-to-date gain. Despite less than ideal user growth in the U.S., some analysts argue that this is nothing to get scared about.With this background, Two Sigma just scooped up a chunk of Snap shares. We’re talking about a total of 5,528,277 or $87.3 million-worth.Kevin Rippey, an Evercore ISI analyst, reminds investors that revenue growth accelerated for the third quarter in a row to 50% year-over-year and losses narrowed to less than $50 million on an adjusted EBITDA basis. While acknowledging that the 1 million quarter-over-quarter U.S. user growth most likely drove the post market selloff, he claims that management’s guidance still reflects ongoing momentum in audience trends. This prompted the analyst to comment, “We’re a bit surprised to not see more initial enthusiasm given aggregate user trends and guidance, as it’s increasingly clear that the accelerative dynamics in SNAP’s business are sustainable.” As a result, Rippey's Outperform rating and $20 price target on Snap stock remain unchanged. (To watch Rippey’s track record, click here)Another Snap bull, Guggenheim’s Michael Morris, thinks that Snap has what it takes to further monetize its core platform: "We also have confidence that Snap will continue to monetize its core platform while creating incremental pathways to scale revenue and complement the user experience – particularly given untapped revenue opportunities within AR, Maps, and Games." Morris adds that Snap’s “unique scale among valuable younger audiences," lends itself to a foundation for sustained equity appreciation. To this end, the four-star analyst maintained his bullish thesis and $22 price target, bringing the upside potential to 47%. (To watch Morris’ track record, click here)In terms of Snap’s Street consensus, analysts are split almost right down the middle. Out of 21 total analyst ratings published in the last three months, the Buys beat out the Holds by just 1, making the consensus a Moderate Buy. In addition, the average price target of $19 amounts to 26% upside potential. (See Snap stock analysis on TipRanks)
Justin Miller, the founder of photo-retouching agency Glo Up Club, says "just a filter doesn't cut it anymore" and that Glo Up can be used to build confidence, rather than dismantle it.
(Bloomberg Opinion) -- In a true Thanksgiving cliche, I would like to enumerate what I'm thankful for in technology.I know, it sure doesn't feel like there are many things to feel good about. Tech tools have allowed misinformation, bullying and social division to spread like a virus. They have empowered tyrants and monsters, and created an underclass of impossible jobs. Some days I want to do a Road Runner cartoon dynamite to the internet and start fresh.But my point was … uh … hopefulness. Even with the technology horribles, I want to give thanks for the mostly good.I'm grateful for the boring stuff: Technology isn't only things that scream TECHNOLOGY like virtual-reality goggles for cows, cars without human drivers and hot-air balloons that beam internet service to a remote Amazon rain forest. Technology is also changes in dairy-barn ventilation that make farms more productive. Technology is french fries that keep up with our changing eating habits, stripped-down smartphones that are affordable and usable enough for billions of people, and software that can reduce airport delays by predicting when jet engines need repairs.I can't gloss over ways that all technology, even the unglamorous stuff, can have horrible consequences for individuals or painful structural upheavals for economies and job markets. But I also don't want to underplay the genuinely good changes that are arising from the big and small innovations happening all around us that we may never notice. I'm grateful for people's creativity: One of my first "aha" moments about Snapchat came from Jerome Jarre, the young Frenchman who got big on the six-second-video service Vine ( R.I.P.) and then on Snapchat. In a story from around 2015, I think, Jarre — in snippets of videos and photos — showed himself traveling to a town in Africa and coaching young children to make solar-powered lights from plastic bottles. (I'm pretty sure there was a marketing tie-in, because internet.) Jarre told a complete story in jagged bits over a couple of minutes, and the personality of the children and Jarre shone through despite — or perhaps because of — the confined format. These billion-dollar internet companies are nothing without the people harnessing new tools to do genuinely novel, fun, outrageous or informative things. Yes, these tools of human expression are also hijacked for horror and greed, but every day I see a brilliant moment of distilled human storytelling on YouTube, TikTok, Instagram, Twitter or some other app. It might come from a 100-year-old news organization or a kid in France, but either way I feel something: joy, outrage, or an understanding of a world I never knew. I'm confident this will keep happening, whatever new ways of communication catch on in the future.I'm grateful for fear: Every business is terrified of being mowed over by technological change, and wow, is it good for you and me. Companies have to try harder than ever to keep people happy. Does anyone lament the days when cable companies could count on getting paid by 95% of U.S. households, no matter how garbage their products were? Customers of retail stores, car-rental services, airlines, banks and (yes) news organizations are better off with companies that are no longer insulated by monopoly economics and relatively hard to reach with complaints. There's nothing like being scared of death to bring out the best in companies.I'm grateful for the watchdogs and the whistleblowers: The horribles of technology are real. That’s why we need academics and researchers who systematically study how misinformation spreads online or root out how our personal privacy is undermined. We need the people working in technology who take the risk of speaking up when they believe something is wrong. We need journalists — self-serving alert — shedding light on the glorious and grim in technology. And even though they get a lot of justified heat, we need regulators and lawmakers to help protect people from the downsides of technology changes. All of us might get it wrong sometimes, but I'm grateful that there are watchful eyes keeping the powerful accountable.After today, I'll go back to being grumpy about everything. I promise. A version of this column originally appeared in Bloomberg’s Fully Charged technology newsletter. You can sign up here.To contact the author of this story: Shira Ovide at email@example.comTo contact the editor responsible for this story: Beth Williams at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shira Ovide is a Bloomberg Opinion columnist covering technology. She previously was a reporter for the Wall Street Journal.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) continues to grow quickly despite its high revenue. In the third quarter, its revenue jumped 20% year-over-year to $40.5 billion.Source: rvlsoft / Shutterstock.com But to keep up the growth, the company will need to find new sources of meaningful revenue. While the ad market is enormous - and digital ads remain in a non-cyclical uptrend - ads are really not enough to sustain Alphabet's growth. After all, other companies like Facebook (NASDAQ:FB), Snap (NYSE:SNAP) and even Amazon (NASDAQ:AMZN) are getting large portions of the ad pie.The cloud does look like a pretty good opportunity - and should be a positive catalyst over the long-term for GOOGL stock.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut the company's primary strength has been in consumer internet apps. That does not necessarily translate too well to business and enterprise customers, who require a completely different sales and marketing approach.But Amazon was in a similar position when it launched AWS, its cloud business. The company, however, was able to leverage its massive software infrastructure and growth capabilities. * 7 Stocks to Buy in December Google has similar advantages. Ramping Up for the CloudThen why hasn't Alphabet's cloud unit been able to get much traction? I think a big reason is that it has not been a strategic priority for the company. Instead, Google has been mostly focused on mobile, video and AI (artificial intelligence).Yet during the past couple of years, the company has certainly gotten more serious about the cloud. And that should be very good news for GOOG stock.About a year ago, the company hired Thomas Kurian, who was formerly the president of product development at Oracle (NYSE:ORCL), to head its cloud unit. He has a deep background in enterprise software like databases, middleware, ERP (Enterprise Resource Planning), supply chain and CRM (Customer Relationship Management). That kind of experience will certainly be essential.While at Google, Kurian has already made some savvy moves. He has been hiring top-notch talent who have experience with sales and support on a global basis. For example, he has recruited: Robert Enslin, the leader of the cloud business group at SAP (NYSE:SAP); Amit Zavery, the executive vice president of Oracle's cloud unit, and Kirsten Kliphouse, an executive with Microsoft (NASDAQ:MSFT).Kurian has also been an aggressive dealmaker. For example, he has been striking alliances with companies like VMware (NYSE:VMW), Wipro (NYSE:WIT) and DXC Technology (NYSE:DXC). Then there was his $2.6 billion acquisition of Looker, a major player in the BI (business intelligence) market. According to a blog post from Kurian: "The addition of Looker to Google Cloud will help us offer customers a more complete analytics solution from ingesting data to visualizing results and integrating data and insights into their daily workflows. It will also help us deliver industry specific analytics solutions in our key verticals, whether that's supply chain analytics in retailing; media analytics in entertainment; or healthcare analytics at global scale." The AI FactorAI has already been a catalyst for Google stock. After creating an AI-based platform called TensorFlow, the company has become an innovator in the space. Google has also made a host of AI-oriented acquisitions, including DeepMind, which has made great strides in pushing the boundaries of AI. GOOG has also hired some of the world's top AI researchers.AI will certainly be a must-have for cloud providers, as many companies are looking at ways of monetizing their data.So Google's cloud unit can offer a plethora of helpful AI services, including machine learning, deep learning, NLP (Natural Language Processing) and computer vision.It can also provide high-end hardware access, data labeling and model training. The Bottom Line on Alphabet StockFor the owners of GOOG stock, it's encouraging that there are clear signs that the company's cloud strategy is working. Last quarter, the company announced a partnership with the Mayo Clinic to securely store data used to help diagnose diseases and conduct clinical research. It also made notable cloud deals with companies like the National Australia Bank, Deutsche Borse Group, and Macy's (NYSE:M).Granted, for Alphabet stock to climb, the company must take multiple steps to improve its cloud unit. After all, Amazon and Microsoft do have significant leads in the cloud wars.But Google has the right capabilities to make a play for the opportunity, as well as $121 billion in the bank. More importantly, the cloud market is massive, with room for multiple operators. Spending on the cloud will hit $331 billion by 2022, according to research from Gartner .Tom Taulli is the author of the book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy in December * 7 Unsteady Stocks Investors Should Consider Selling Before 2020 * 7 Entertainment Stocks to Buy to Escape Holiday Blues The post Alphabet Stock: Is Google's Cloud Strategy Working? appeared first on InvestorPlace.
We've heard about the battle between Snap (NYSE:SNAP) and Facebook (NASDAQ:FB) a million times before. Many believe that Snap comes up with the ideas and FB copies them. Today we will look at why, from an investment purpose, what matters is Snapchat stock against itself.Source: franviser / Shutterstock.com The $16 area is a major pivot point that is likely to be ongoing resistance. Before you send me hate mail, know that this is not the same as me being bearish. In fact, the bulls have the opportunity to bury this resistance and turn it into an asset going forward.In May, when the equity markets were falling, SNAP stock laid the foundation for a great 50% rally off the $12 neckline. This is during a period of time when experts in the media were busy selling us on the idea that a recession was imminent. Meanwhile, they missed a bullish setup from a trio of patterns. Snapchat stock had just broken out of a long-term descending channel that started from its IPO. Then at the same time it was also setting a bullish inverse head-and-shoulder pattern. All this while the price action had reached a horizontal contention level dating back to August 2018.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy in December The result of this trifecta was a fantastic rally that filled its potential to $18 perfectly. The positive violent reaction to earnings was a perfect time to book that breakout. Those earnings bursts often exhaust the buyers especially when they come at the tail end of a powerful rally. Tactically, it is best to book the profit and snipe another entry. True to form, SNAP stock fell 30% and almost all the way back to the neckline from which the rally started. But this is normal price action, albeit large in size. But a rally can give back half the distance and remain a viable thesis. The buyers are still in charge as long as SNAP stays above $14.50 per share. Snapchat Stock's Picture-Perfect Finish for 2019Source: Charts by TradingViewSource: Charts by TradingViewWhile there never are guarantees, if the stock markets don't correct before year-end then Snapchat stock has the chance at another rally. If the buyers can close above $16 then they can trigger the chain of events that would bring a third touch of the year's high. And that is the gateway for an even more massive rally to unfold in 2020. Not many experts expect SNAP stock to be over $20, but it is a possible scenario.Fundamentally, SNAP is not cheap. It still loses money and sells at 18 times sales. Clearly, Wall Street gives it leeway on valuation for the sake of growth. There is no doubt that this is a popular platform especially among young people, but the proof is in the pudding if it will be a viable advertising model that will rival Facebook, Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) or even Amazon (NASDAQ:AMZN).In reality there is enough business to go around for all major social media companies including Snap. The digitization trend is global and irreversible. Moreover, it is catching on exponentially so unless Snapchat's management flubs again, the stock should be a good trading vehicle. Today's opportunity is tactical so unless I want to own the share for a long time it is best to set a finite stop-loss to prevent it from becoming an investment. SNAP Stock Trading VideoNicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy in December * 7 Unsteady Stocks Investors Should Consider Selling Before 2020 * 7 Entertainment Stocks to Buy to Escape Holiday Blues The post Snapchat Stock Can Have a Picture-Perfect Finish for 2019 appeared first on InvestorPlace.
Twitter (NYSE:TWTR) stock rallied nicely for most of 2019, and received a healthy valuation as a result. In fact, on an earnings basis, Twitter stock was valued at a substantial premium to larger peers in social media and online advertising.Source: Worawee Meepian / Shutterstock.com But Twitter's disappointing third-quarter report suggests that premium wasn't deserved -- and still isn't. Investors aren't going to pay up for single-digit revenue growth and compressing margins. There are other plays in social media and or online advertising doing better at the moment.That creates a simple, and significant, problem for Twitter stock at the moment. It's still receiving that premium to those same peers, if not quite to the same extent it did a little over a month ago. And so Twitter either needs to re-inspire confidence quickly, or TWTR stock could have more downside ahead.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Twitter Stock and PeersAbove $30, an investor needs to believe that Twitter stock is more attractive than other similar offerings in this market. Among major names, those include social media rivals Facebook (NASDAQ:FB) and Snap (NYSE:SNAP), along with online advertising competitor Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL).And there has been a case for choosing TWTR stock over those names. Facebook and Alphabet both face significant risk from a regulatory perspective, with U.S. federal government agencies investigating both companies. * 7 Strong Buy Stocks That Are Bargains Right Now Political worries aside, investors long have worried that Facebook will lose users (particularly younger users) to other platforms. The duopoly in online advertising growth between Facebook and Google is starting to crack, and that latter company has struggled to gain traction outside of ad revenue, excepting its Waymo self-driving vehicle unit. Snap, meanwhile, remains unprofitable.In that context, Twitter seemed lower risk. And while its revenue growth lagged that of Facebook and Alphabet, the company had room to grow margins and thus profits at a higher rate. Twitter was attracting more advertisers and better monetizing its users, boosting long-term growth hopes as well.Indeed, through the first nine months of the year, Twitter stock outperformed both Facebook and Alphabet. It lagged SNAP, but so did the rest of the market: That stock has been one of the market's best performers this year, even after a recent pullback. Investors were reacting to what looked like an attractive long-term opportunity with potentially less risk than other major stocks in its group. The 'New' Case for TWTR StockThat said, there was one underlying risk for TWTR stock. In late August, I called out the company's elevated operating expenses as a risk to margins. It was guidance for similarly high spending on the health of the underlying platform that led FB stock to the largest one-day loss of value in the history of the stock market last year.Through the first half of the year, Twitter's revenue growth had been enough to offset that spending. That changed in the third quarter. Revenue grew just 9%, thanks to lower per-user monetization. Guidance for the fourth quarter was weak as well.In both cases, Twitter called out "bugs" in its mobile application promotion product and issues with "certain personalization and data settings" as headwinds to revenue. But those issues only hit revenue growth by "3 or more points" in Q3 and are guided to an impact of "4 or more points" in Q4.Backing that out, revenue grew 13% in Q3 and at the high end of guidance would increase 15% in the fourth quarter. Both figures are a notable deceleration from the first half. More importantly, both materially trail the outlooks for Facebook and Google.In other words, Twitter now isn't growing as fast as its larger peers, let alone Snap. It has the same spending problem that sent Facebook stock tumbling last year. Regulatory risk might be lower, but there's still the question of the so-called "President Donald Trump effect."That doesn't sound like the profile of a stock that should trade at a premium. Yet even one-third below September highs, that's exactly how Twitter stock trades. Twitter Still Looks ExpensiveBacking out a bit over $5 per share in net cash, TWTR stock trades at roughly 27 times 2020 consensus earnings per share estimates. Both GOOG stock and FB stock sit closer to 20 times.Again, there was a case that TWTR deserved a premium to those names before the report. Afterwards, that's a much more difficult case to make. Revenue growth is decelerating. The margin opportunity may not be what was hoped if spending on platform health has to keep rising. User growth has impressed in recent quarters, but it was stagnant before last year and may stall out again.It's difficult to pound the table for Twitter stock over alternatives in its group, let alone across the market. In fact, it's probably easier to argue that TWTR should be valued closer to the 20x earnings-plus-cash figure assigned FB and GOOGL, which suggests a share price closer to $24, another 20% downside from here.The only way Twitter holds $30, let alone rebounds, is if management can again convince investors that a premium to peers and to the market is merited. If the company can prove that the bugs and settings problems are short term and return to growth, that might be enough. But that's still a big "if," and a catalyst that won't arrive until February. In the meantime, Twitter stock looks like a name to avoid at best.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Strong Buy Stocks That Are Bargains Right Now * 7 Excellent Bank Stocks Worth an Investment * 4 Small-Cap, Big-Dividend Stocks The post Disappointing Earnings Create a Difficult Problem for Twitter Stock appeared first on InvestorPlace.
Looking for stocks with high upside potential? Just follow the big players within the hedge fund industry. Why should you do so? Let’s take a brief look at what statistics have to say about hedge funds’ stock picking abilities to illustrate. The Standard and Poor’s 500 Index returned approximately 26% in 2019 (through November 22nd). Conversely, hedge […]
Kelly Nyland and Rhenee Bartlett helped launch Spectacles for Snap. Now they have their own company, a "text boutique" called Whym.