Snap and Pinterest stocks are on the rise as a result of positive projections for advertising trends, according to Jefferies analyst James Heaney. Heaney has upgraded shares of Snap and Pinterest from Hold to Buy, with revised price targets for both companies.
Snap's Controversial Call
Heaney has labeled his upgrade of Snap as a "more controversial call." Despite a 58% increase in stock value this year, the company has faced challenges. In October, the parent company of Snapchat reported impressive third-quarter financial results, exceeding expectations. However, they refrained from providing official guidance for the fourth quarter due to concerns about the uncertainty caused by conflicts in the Middle East.
Snap has also encountered difficulties in advertising due to rising inflation and interest rates. Nevertheless, Heaney's upgrade is based on an anticipated improvement in the company's advertising revenue.
With these positive developments, investors are seeing potential opportunities in Snap and Pinterest stocks, leading to a climb in their value. Heaney's upgraded price targets for Snap and Pinterest are $16 (up from $12) and $41 (up from $32), respectively.
The Power of Direct-Response Advertising
Snap Inc. and Pinterest Inc. have experienced significant growth in their stock prices recently, thanks to the effectiveness of direct-response advertising (DR). DR ads prompt users to take immediate action, such as making a purchase, resulting in improved performance for advertisers and substantial budget growth.
Snap's Impressive Climb
Snap's shares have soared by 41% this month, reaching $14.07 on Thursday. This marks the highest closing price for Snap since July 2022 and indicates a strong upward trend. The company's stock is on track to achieve its best month since October 2020.
Pinterest's Promising Outlook
Pinterest is also benefiting from the positive impact of DR advertising. Following an upgrade from an analyst, Pinterest's shares have risen by 3.7% to $34.49. This surge in price puts them on track for their highest closing since January 2022.
This year, Pinterest has seen a remarkable 43% increase in its shares. The photo sharing platform reported impressive third-quarter financials in October, surpassing Wall Street's expectations. Additionally, ad impressions have grown by 26%, showcasing the significant engagement and views on the platform.
The success of DR advertising for both Snap and Pinterest demonstrates its potential for driving growth and delivering exceptional results for advertisers. As these platforms continue to enhance their DR platforms, advertisers can expect even better performance and increased budget growth in the future.
PINS Upgrade Potential Shown in Recent Report
A recent initiation of coverage has prompted an upgrade on PINS based on several key factors. The upgrade highlights the potential for significant EBITDA growth over the next few years and expresses a newfound confidence in ad pricing tailwinds. Furthermore, the report suggests that user growth and engagement gains have proven to be more sustainable than originally anticipated.
This optimistic outlook comes from industry expert, Heaney, who believes that these factors will have a positive impact on the company's performance moving forward.
According to a recent survey, US crude oil and fuel inventories are expected to decline while gasoline stockpiles are likely to increase. Severe winter weather...
Hedge funds employing long/short strategies have benefited from the underperformance of heavily shorted stocks in 2024. This shift in performance has created op...