Shares of Snapchat parent Snap in Tuesday trading saw a second straight day of gains, buoyed by an upgrade from Cantor Fitzgerald which cited an improved reward-to-risk relationship following the stock’s lockup period expiration.
Still, some strategists see a choppy road ahead for the stock that’s declined nearly 25 percent since its initial public offering five months ago.
Snap, since rallying up toward $30 per share in March shortly after its $17 IPO, has been making “nothing but a series of lower lows and lower highs since,” said Craig Johnson, chief market technician at Piper Jaffray. The stock’s trend has clearly been downward since it began trading.
“It’s going to take a close above about $13 to reverse a little of the short-term downtrend. Longer-term, you need a close above $15, or $16, to reverse that downtrend,” Johnson said Monday on CNBC’s “Power Lunch.”
He noted that his firm’s analyst covering Snap, Samuel Kemp, carries a “neutral” rating on the stock given longer-term structural issues with the company. Indeed, Kemp’s price target is a slightly bearish $12.50. He noted in a recent research report that monetization continues to lag expectations in…