Key Points
Snap stock is gaining ground following a new analyst research note.
Bernstein raised its one-year price on Snap from $9 per share to $10 per share, citing encouraging trends in the broader digital ads market.
Snap stock is still trading at beaten-down levels, but user engagement trends in the U.S. market are a challenge for the company.
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Despite some bearish valuation pressures for the broader tech sector today, Snap (NYSE: SNAP) stock is moving higher in Tuesday’s trading. The company’s share price was up 4.2% as of 1:30 p.m. ET. At the same point in the daily session, the S&P 500 had dipped 0.1%, and the Nasdaq Composite was down 0.4%.
Snap is getting a boost from new analyst coverage from Bernstein. The investment firm published a note on the company this morning that maintained a market perform rating on the stock and increased its one-year price target from $9 per share to $10 per share. The firm’s analysts said that it was becoming more difficult to identify likely underperformers in the internet sectors in light of current market conditions. They also indicated that they were seeing solid performance metrics in the digital-advertising space that is central to Snap’s sales and earnings.
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Is Snap stock a buy right now?
The tech-heavy Nasdaq Composite index’s level has risen roughly 8% across 2025’s trading, and Snap stock has been a significant underperformer. Even with today’s pop, the company’s share price is still down roughly 4% this year.
The company’s sales increased 14% year over year to $1.36 billion in this year’s first quarter, and the daily active users (DAUs) on its platforms increased 9% year over year to reach 460 million. While the business posted a net loss of $140 million in the period, it marked a significant improvement over the roughly $305 million loss recorded in the prior-year period.
Unfortunately, Snap’s user growth has largely been driven by additions outside the U.S. — and its users in international markets typically monetize at lower levels. DAUs in the U.S. actually declined to roughly 99 million in Q1, down from 100 million in last year’s fourth quarter. Compared to other leading players in the social media industry, the company also appears to have relatively weak positioning in artificial intelligence (AI). With the stock continuing to trade at beaten-down prices, it wouldn’t be shocking to see its valuation bound above current levels — but investors also have stronger players in the tech sector to choose from.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
