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Snap (SNAP) Gains As Market Dips: What You Should Know

Zacks Equity Research

Snap (SNAP) closed the most recent trading day at $17.41, moving +0.29% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.29%. At the same time, the Dow lost 0.46%, and the tech-heavy Nasdaq lost 0.27%.

Coming into today, shares of the company behind Snapchat had gained 20.14% in the past month. In that same time, the Computer and Technology sector gained 7.47%, while the S&P 500 gained 4.56%.

Wall Street will be looking for positivity from SNAP as it approaches its next earnings report date. This is expected to be February 4, 2020. In that report, analysts expect SNAP to post earnings of $0 per share. This would mark year-over-year growth of 100%. Our most recent consensus estimate is calling for quarterly revenue of $560.39 million, up 43.75% from the year-ago period.

Investors should also note any recent changes to analyst estimates for SNAP. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. SNAP is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, SNAP is currently trading at a Forward P/E ratio of 822.32. This represents a premium compared to its industry's average Forward P/E of 56.14.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 106, putting it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow SNAP in the coming trading sessions, be sure to utilize Zacks.com.


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