I heard about that it's because of another stupid SPAC one that is billing itself as another one of the VLDR & LAZR type. Except they have no business. Driving interest in sector. Snap: Poised To Beat Earnings Again Jan. 20, 2021 8:19 AM ETSnap Inc. (SNAP)1 Comment Snap reports Q4 earnings soon and may be poised to beat estimates; Revenue, Earnings, and User numbers. Snap's demographic advantage will lead to higher user figures from emerging markets, as North America and Europe are stalling. Average user monetization is still well below peers and will serve as a catalyst for higher revenue growth in the following years. Snap may be getting ahead of itself in terms of valuation, as euphoric optimism lifted shares 163% in 2020. Overview Snap (NYSE:SNAP) has been one of the most promising social media stocks of the year, rallying nearly 170% in 2020. Even though I've cut my position, I believe Facebook's (NASDAQ:FB) scrutiny and a possible earnings beat may be able to lift shares higher even in the near-term. That said, I remain bullish about Snap's prospects concerning revenue, profitability, and user numbers, but shares are looking increasingly overvalued. Now, investors will focus on key metrics in Snap's Q4 earnings call, including revenue, EPS, and most importantly, its user figures. In this context, Snap may be poised to beat estimates based on a strong earnings history, Facebook's ad-boycotts, and record E-commerce spending during the holiday season. Furthermore, due to renewed lockdowns in Europe (and parts of North America), and the closure of Schools and Universities could have a strong impact on user and engagement figures, a key metric to investors. In terms of outlook, Snap's continuous efforts in integrating AR lenses are starting to pay off as more brands migrate to Snapchat to take advantage of a specific audience with high engagement rates. Moreover, Snap's discovery section and original shows are likely to support strong revenue growth in the following years, as average monetization still has more room to grow than Facebook and Twitter (NYSE:TWTR). While user numbers are finally growing steadily, it should be noted that Snapchat's user growth will be derived mostly from emerging regions (such as India). For now, these regions only account for a fraction of Snap's revenue, so it'll be crucial to see how effectively Snap can monetize these users moving forward. Demographic Advantage Source: Statista Snapchat has been the most important social network amongst teens (Gen Z), aged 14-20, an attractive niche group for advertisers to target. The reach among Gen Z and Millenials is enormous: 48% of all U.S internet users aged between 15 to 25 are simultaneously Snapchat users, and another 30% aged 26-35 currently use Snap's platform. The app continuous to drive one of the highest engagement rates among young users, yet TikTok has been catching up quickly in 2020. Evan Spiegel has noted that it does not view TikTok as a direct competitor, and the short-video app remains the largest advertiser on the platform. I would generally agree with that statement as Snapchat is rather a direct communication service, yet there are striking similarities that could eventually put competitive pressure on Snapchat. Regardless, Snap is beginning to shift its demographics towards Millenials, reinventing an app made primarily for college students. The efforts certainly paid off, as Snap picked up user figures from a low of just 186 million in 2018 to an impressive 249 million in 2020. Source: Knoema (U.S. Census Bureau) The demographic trends are also favoring Snapchat's user development: It is expected that Millennials will become the largest demographic in terms of population size. The population trends worldwide are also boosting Snapchat user trends, as the world population is expected to grow by another 2 billion people by 2050 (mostly in developing nations). Keeping users hooked in Europe will become more challenging as the population is skewing older in the future; thus, it will be crucial to make the platform appealing to older generations. Source: Snap In Snap's Q3 earnings call, the social media platform saw an increase of 11 million users compared to Q2, 18% growth YOY. While these figures certainly point to healthy growth, it should be pointed out that user numbers stalled in Snap's most crucial advertising markets North America and Europe, in the last quarter. Most of the user growth (+10 million) came in from the rest of the world, which is still low-monetized at the moment. Going forward, the international user base could double from the current 159 to 360 million by 2025, while North America could further grow to 105 million users. Compared to Facebook's 195 million active users in North America, that's still a decent figure and leaves room for monetization growth. Augmented reality/E-Commerce Monetization In recent years Snap has been investing heavily into augmented reality filters with tremendous success: Roughly 75% of Snapchat's daily users engage with AR lenses and have created over 1.5 million lenses through Lens Studio. Snap's augmented lenses could generate over $4 billion in e-commerce revenue within over next few years, as brands are experimenting with virtual shopping experiences. We think sponsored lens/filter ads are better positioned to scale at Snap than most investors realize and set to tie in more explicitly with the company's somewhat vague e-commerce strategy,” Deutsche Bank Analysts. Source: SEJ Major companies, including Gucci and Champs Sports, are already letting customers try-on sneakers virtually through Snap lenses. Moreover, beauty company Perfect Corp saw a 32% increase in virtual make-up try-on's during the pandemic. This trend is expected to accelerate rapidly within the next few years as virtual E-commerce shopping becomes widely adopted. Of course, Snap won't be the only media company taking advantage of this trend and will certainly face competition from Instagram and Pinterest (NYSE:PINS). Either way, Snap is well-positioned to capture a decent piece of a multi-billion dollar pie with one of the highest engagement rates in the space. Analyst Rob Sanderson from Loop Capital Markets has mentioned Snap could be on its way to possibly become a $200 billion company (+170%) by 2025 if it were to mirror Facebook's monetization trajectory in upcoming years. Strong monetization growth of users in North America and Europe could boost sales to nearly $20 billion in 2027 and see higher margins due to increasing scalability. Source: Snap Indeed, Snap's average revenue per user still trails significantly behind Facebook and Twitter's monetization rates, especially in key markets such as North America and Europe. In comparison, FB's monetization rates in North America stand at $40, which implies an upside of nearly 8 times to Snap's $5 ARPU rates. A similar picture is painted in Europe, where Facebook monetizes its users at 12$ on average, compared to Snap's mere $1.43. While Twitter does not disclose average revenue per user figures, it is estimated that it's still significantly higher than Snapchat, despite Snap's more favorable ad-segments. Therefore, I believe Snap can exponentially increase its monetization figures for years to come and push gross margins upwards of 60%, as its beginning to scale effectively. Source: eMarketer Either way, Snap's revenue growth rates are likely to stay robust in the following years due to strong growth trends in E-commerce ads. So far, Snap's share of the U.S digital-advertising market only stands at roughly 3%, counteracting the duopoly from Google and Snap. In this context, it should be noted that Snap's CPM rates are roughly 8 times lower than those of Instagram, costing advertisers only $2 per 1000 impressions. This will likely cause more brands to migrate to the platform, as advertisers are reporting a positive ROI with Snapchat's story ads. Another catalyst for continuous ad growth includes the user engagement platforms 'Discovery', 'Games,' and 'Maps,' which have plenty of monetization potential. In the latest earnings call, CEO Spiegel mentioned that users' average time on Discover increased 50% YOY. More impressively, some 14 million users tuned in for Snap's original 'VS The World' starring Connor McGregor. In comparison, Netflix's (NASDAQ:NFLX) most-watched show in 2020, 'Money Heist,' had roughly 65 million viewers, even though Snapchat is primarily a messaging service. Like Youtube, I believe Snap can monetize these millions of viewers, starting with skippable 5-second ads and slowly increasing advertisements once the audience is established. Source: Mapbox While Snapchat's Maps was created to be another engaging tool for users to connect with each other, I believe the monetization opportunity is enormous: Already more than 200 million users engage with maps to virtually connect, sharing location and activities. The chances for streamline local marketing are immense, considering local restaurants, businesses, etc., can advertise through Snap Maps to reach possible customers. Yes, there are certainly major reasons for concerns with Snapchat's Maps in terms of security, but the potential here is exciting. Moreover, Snap's integrated games could become another growth engine for ad-growth and in-app purchases. Analysts are projecting: Revenue: 841.9M (50% YOY) EPS: 0.06 (100% YOY) Total Users: 259M (19% YOY)* (*Author's prediction) Why Snap may beat Q4 estimates: Renewed Lockdowns: Europe has a large Snapchat user base, and many countries entered a full lockdown in November, including closing schools and Universities. In some states of the United States, new restrictions were introduced as well. During times of reduced social contact, people would want to stay in touch with each other. As a result, engagement of users likely rose sharply, and user numbers in key markets such as North America and Europe probably saw an uptick. Data from Sensor Tower supports the statement, as Snap was the 7th most downloaded app in 2020 with a total of 281 million downloads. The closure of retail markets led to record e-commerce spending during the holiday season, as U.S online sales rose by an estimated 32% from 2019 to $188 billion. Like other social media companies, e-commerce ad revenue remains a large segment of Snap's total revenue. This could lead to a solid beat on the sales side of earnings. Source: Forbes Strong Earnings History: In the last 3 years, Snap has beaten EPS estimates of 10 out of 12 quarters. However, Snap is considered a high-growth company; thus, revenue and user metrics are the most crucial factors. Below I have listed the last 3 quarters in 2020 where Snap has beaten revenue metrics with the following stock price changes: Q1 2020: 36% Q2 2020: -6% Q3 2020: 28% If Snap can beat revenue and EPS estimates, the stock could surge higher following the announcement. However, it is also crucial that it beats on EPS to highlight the path of profitability in 2021. It should be noted that in Q4 2020, Snap widely beat EPS estimates by nearly 300%, though user figures came short. Either way, a beat in sales should have a positive effect on Snap's EBITDA. Source: SA Facebook's weakness: The continuous scandals surrounding Facebook shed a positive light on Snapchat regarding its advantage over data privacy issues. Due to Facebook's ad-boycott, Snap benefitted from advertisers flocking to the platform and users searching for social media alternatives. However, when looking at FB and Snapchat user numbers, there is no clear correlation between users leaving FB and/or switching to Snapchat. After all, Snapchat also banned Trump's account on the platform and will likely see tighter data regulation under Biden's administration. Either way, Facebook's scrutiny certainly did not harm Snap this year, as more users are looking for alternatives. Valuation Concerns IMO, Snap has been either significantly overvalued or undervalued since its IPO in 2017. After falling to just $5 a share in late 2018, Snap has been undervalued consistently relative to its growth potential. However, after rallying more than 500% since its March lows, shares seem to be getting ahead of themselves. Even though other tech companies with similar growth rates have higher valuations, I believe there are cheaper social media stocks, which aren't as overbought. Thus, after Snap's massive comeback in 2018, investors might be currently pricing in too much optimism into shares. Data by YCharts Snap is currently trading at 34x EV to sales, while beaten-down peers Facebook and Twitter are trading at just a third of Snap's valuation. Yes, Snap and Pinterest are growing faster and have fewer controversies at the moment, but nevertheless, shares are looking increasingly overvalued. That said, Snap is trading at roughly 11.5x its projected sales for FY2023. I still believe Snap shares will go higher in the long run for the reasons mentioned above, yet Facebook or Twitter seem to be more lucrative options at the moment, even with slower growth rates and ongoing political instability. Furthermore, Snap's growth rates might decelerate in 2021 if the vaccine is distributed and E-commerce advertisements slow down. My take on Snap Snapchat had a strong run in 2020 despite the pandemic, and investors are questioning whether it can continue throughout 2021. The social media platform benefited from strong user engagements, e-commerce ad growth, and Facebook's data scrutiny as more advertisers migrated to Snapchat. The app continues to thrive with innovations such as Discover shows, Games, and Maps, having tremendous monetization potential. However, despite Snap's rosy outlook, I believe the risk/reward ratio is not favorable on Snap in terms of valuation. Shares are trading at nearly 11x projected sales in 2023, so I believe the stock has gotten a little ahead of fundamentals. However, this does not mean I'm not bullish about the prospects, and as mentioned, Snap might go higher even in the short run when Snap reports Q4 earnings. Fab balanced take on SNAP I found at Seeking Alpha.
Clean Energy price target raised to $12 from $6 at Craig-Hallum 01/05 CLNE Craig-Hallum analyst Eric Stine raised the firm's price target on Clean Energy to $12 from $6 and keeps a Buy rating on the shares. The analyst believes momentum is set to continue in 2021 as low-CI RNG MoUs is now in place. Overall, Stine sees Clean Energy as an ideal investment in clean transportation.
Clean Energy call volume above normal and directionally bullish 12:05 CLNE Bullish option flow detected in Clean Energy with 7,961 calls trading, 1.1x expected, and implied vol increasing over 2 points to 129.67%. Feb-21 12 calls and Feb-21 10 calls are the most active options, with total volume in those strikes near 3,700 contracts. The Put/Call Ratio is 0.11. Earnings are expected on March 9th.
Clean Energy Fuels Corp. (CLNE)- 1 year chart says I'm a new leader. NasdaqGS - NasdaqGS Real Time Price. Currency in USD $10.51+0.57 (+5.68%) As of 1:57PM EST. Market open.
Skillz Inc. (SKLZ)-Who's With Me! NYSE - Nasdaq Real Time Price. Currency in USD $29.28+2.61 (+9.79%)<---------------- As of 2:21PM EST. Market open.
OK WATCH THIS... YESTERDAYS BUY IS ABOUT TO TAKE OFF!!! WARNING WARNING WARNING! BIG VOLUME BABY!!! DID NOT GO DOWN TODAY! HELD FIRM! Atossa Therapeutics, Inc. (ATOS) NasdaqCM - NasdaqCM Real Time Price. Currency in USD $1.4473+0.0373 (+2.65%) As of 2:23PM EST. Market open.