What Happened?
Shares of social network Snapchat (NYSE: SNAP) jumped 4.4% in the afternoon session after an analyst at Bernstein raised the firm's price target on the stock.
The social media company received a vote of confidence from Bernstein analyst Mark Shmulik, who lifted his price target on Snap to $10.00 from $9.00, while maintaining a "Market Perform" rating on the shares. A price target is an analyst's projection of a stock's future value. The increase, even without a full rating upgrade, signals that the analyst sees more potential upside in the company's stock price than previously estimated. This can boost investor confidence, suggesting that the company's outlook may be improving. The "Market Perform" rating is similar to a "Hold" recommendation, indicating the analyst believes the stock will likely perform in line with the broader market.
After the initial pop the shares cooled down to $10.28, up 3.9% from previous close.
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What Is The Market Telling Us
Snap’s shares are very volatile and have had 28 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 3.4% as the second quarter (2025) earnings season got off to a strong start.
Quarterly earnings reports released during the week exceeded Wall Street's expectations, fueling investor confidence. Around 50 S&P 500 components reported, with 88% of those exceeding analysts' expectations, FactSet data revealed. Investors were also encouraged by several positive reports that painted a picture of a resilient consumer. One key report revealed that shoppers increased their spending at U.S. retailers more than economists had anticipated. Precisely, retail sales increased 0.6% from May, surpassing the 0.2% estimate. This robust consumer spending is a crucial pillar supporting the economy.
Adding to the positive sentiment, the latest data on unemployment claims showed a decrease in the number of workers applying for benefits, signaling that layoffs remain limited and the job market is steady. This combination of strong earnings reports, retail sales, and a solid labor market suggests the economy is navigating challenges successfully.
Snap is down 8.6% since the beginning of the year, and at $10.28 per share, it is trading 30.5% below its 52-week high of $14.78 from July 2024. Investors who bought $1,000 worth of Snap’s shares 5 years ago would now be looking at an investment worth $442.89.
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