Snap Stock Snapped on Profit Warning, but Should Wall Street Punish the Company's Honesty?
If Tuesday, May 24, 2022, is remembered at all on Wall Street, it may be known as the day when Snap (NYSE: SNAP) stock tanked so hard that it seemingly took down the entire tech sector. As Snap stock took a 43% haircut -- its biggest single-day decline -- traders old enough to recall the bursting of the dot-com bubble may have experienced an unsettling sense of deja vu.
The catalyst wasn't a quarterly report, but a revision of the guidance given in the most recent one. It was an unwelcome surprise to the investing community, but the wholesale share dump offers a second chance to buy the social media giant stock at pre-COVID-19 prices. Is it a buy?
Just a month ago, Snap released first-quarter 2022 results that weren't ideal, but at least seemed par for the course during a time when investors had generally turned sour on the tech sector. Snap grew its daily active users 18% year over year to 332 million in the quarter, and increased its revenue 38% to $1.06 billion. Furthermore, the company swung from adjusted EBIDTA of negative $2 million in the prior-year quarter to $64 million in Q1 2022.
Source Fool.com
