Media sharing platform Snap, Inc. (NYSE: SNAP) has been in the spotlight in recent weeks for the sharp movements of its stock, which maintained a steady uptrend. On Monday, the stock suffered one of the biggest intraday losses in recent times, marking a reversal of the recent trend wherein it made strong gains. Earlier, music streaming site Spotify announced a deal with Snap allowing users to share music and podcast on Snapchat.
Snap shares ended Monday’s trading down 7.8% after staying low throughout the session. A few days ago, they had climbed to the highest level in nearly three weeks. The market seems to have reacted to reports that app downloads declined by nearly a fifth in the latest quarter, compared to the previous quarter when the newly added face-swap feature spurred strong user growth.
The photo-sharing app got a major boost last week after brokerage Evercore upgraded it to outperform from in-line and lifted the price target by two dollars to $20, citing the company’s advancements in the gaming space. The analyst also predicted that Snap would generate about $350 in gaming revenues in the next three years, giving a major push to margins.
Snap’s market value nearly tripled this year and the shares have crossed the $15-mark once again. The stock gained about 65% in the past twelve months and outperformed the market, underscoring the view that it is overvalued. It moved up nearly 7% last week alone.
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