Why Snap Stock Is Handily Beating the Market This Week
The market had a good first week of October, rebounding somewhat from September's 9% drop. But shares of Snapchat's parent company, Snap (NYSE: SNAP), are performing even better. As of noon on Friday, Snap stock is up 10% this week, according to data provided by S&P Global Market Intelligence, compared to the 2% positive return for the S&P 500. And it's because Wall Street is becoming increasingly optimistic about the state of the digital advertising space.
Analysts Thomas Champion and Doug Anmuth, of Piper Sandler and J.P. Morgan, respectively, are both encouraged by what they're seeing in the digital ad market, based on commentary they made early this week. Snap's ad rates have fallen as the U.S. economy has struggled. But according to The Fly, Champion thinks ad rates stopped dropping for Snap back in July. Snap's own management said that revenue three weeks into the third quarter of 2022 was flat year over year, mirroring Champion's thoughts.
On Wednesday, Ross Sandler of Barclays went a step further. Sandler is also encouraged by digital ad trends. And this is partly why he raised his price target for Snap stock from $15 per share to $21 per share, according to The Fly.
Source Fool.com
