Neil's avatar
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Is Snap Stock a Buy Under $10?

The stock is down 58% since its IPO. In this video, I will talk about Snap, which saw its stock crash over 70% in 2022. The company's growth is decelerating while expenses have increased, and in an environment where ad spending is low, things could get worse for Snap before they get better.

Conor Mac's avatar
I can’t see it surviving LT, so wouldn’t be a buy for moi
Joshua Simka's avatar
Yeah, hard pass. This passage is from their Q3-22 investor letter. And we have to keep in mind that TikTok and Instagram, meanwhile, are thriving.

Forwardlooking revenue visibility remains incredibly challenging, and
this is compounded by the fact that revenue in Q4 is typically
disproportionately generated in the back half of the quarter, which
further reduces our visibility. Given these factors, we do not intend
to provide formal financial guidance for Q4. That said, we believe
it is highly likely that year-over-year revenue growth will decelerate
as we move through Q4, due in large part to the fact that Q4 has
historically been relatively more dependent on brand-oriented
advertising revenue, which declined slightly on a year-over-year
basis in the most recent quarter. As a result, we have set our
internal forecasts based on the assumption that year-over-year
revenue growth will be approximately flat in Q4, and we estimate
that Adjusted EBITDA would be approximately $200 million under
that revenue assumption for Q4. We expect to incur the remainder
of the transition costs associated with our strategic reprioritization
in Q4 and estimate these costs will be between $20 and $35
million, which will therefore present a commensurate headwind to
net income in the quarter.

Neil's avatar
@tomato Remember this? "Snap CEO Evan Spiegel said that the company’s forecast of multiple years of more than 50% revenue growth is achievable even without any additional user growth. “The 50% number actually isn’t predicated on any further user growth or any engagement growth.__"



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