Snap Inc. (NYSE: SNAP) shares declined on Thursday, despite beating analyst estimates in its fourth-quarter earnings report released after Wednesday's close. The down move comes as technology stocks are broadly lower today, with the Nasdaq down 1.68% and the S&P 500 declining 1.33%.
Earnings Beat Expectations
The social media company reported quarterly earnings of three cents per share, surpassing the consensus estimate for a loss of three cents per share. Quarterly revenue reached $1.72 billion, beating the analyst consensus estimate of $1.702 billion by 0.84%. This represented a 10.21% increase over sales of $1.557 billion in the same period last year.
User Metrics Show Decline
Despite the revenue beat, daily active users (DAU) fell to 474,000 in the fourth quarter, down from 477,000 DAU in the third quarter.
However, the company reached 946 million global monthly active users (MAU), an increase of 51 million or 6% year-over-year.
Technical Analysis
The stock is currently trading 29.1% below its 20-day simple moving average (SMA) and 32.4% below its 100-day SMA, indicating significant bearish pressure. Over the past 12 months, shares have decreased by 49.62%, and they are currently positioned closer to their 52-week lows than highs, reflecting ongoing weakness.
The RSI is at 21.44, which is considered oversold, suggesting potential for a rebound if buying interest returns. Meanwhile, the MACD is below its signal line, indicating continued bearish momentum.
The combination of oversold RSI and bearish MACD suggests mixed momentum, reflecting a challenging environment for Snap.
- Key Resistance: $7.50
- Key Support: $5.00
- Evercore ISI Group: In-Line (Lowers Target to $9.00) (Feb. 5)
- Wells Fargo: Equal-Weight (Lowers Target to $8.00) (Feb. 5)
- Cantor Fitzgerald: Neutral (Lowers Target to $7.00) (Feb. 5)