Are you buying SNAP tomorrow?

Discussion in 'Current Events' started by jpu, Mar 1, 2017.

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Are you buying SNAP on the day of its IPO?

Poll closed Mar 2, 2017.
  1. Yes

    2 vote(s)
    66.7%
  2. No

    1 vote(s)
    33.3%
  1. jpu macrumors member

    jpu

    Joined:
    Mar 1, 2014
    #1
    Are you planning on buying SNAP tomorrow on the day of its IPO? Or buying it in the days/weeks following the IPO? What are your thoughts on the stock?
     
  2. JaySoul macrumors 68020

    JaySoul

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    #2
    It's up in 15 minutes and I'm watching it very closely.

    Definitely in the "Sceptic" camp long-term but could be a short-term play.
     
  3. obeygiant macrumors 68040

    obeygiant

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    #3
    It'll go up then as the excitement goes away it'll settle down.

    Snap Inc. is currently valued at $24b.
     
  4. ucfgrad93 macrumors P6

    ucfgrad93

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  5. JaySoul macrumors 68020

    JaySoul

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    #5
    I did!

    It's up 11% right now which is something.

    Basically my hope is it gets up to $50, then I'd pull out. I realise "hope is not a strategy" but this is my one "fun stock pick" for the year :D
     
  6. Plutonius macrumors 603

    Plutonius

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    #6
    Pull out now and bank your earnings.
     
  7. JaySoul macrumors 68020

    JaySoul

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    #7
    That was the plan but bizarrely enough, I've got a feeling that the institutional investors are going hard into it, and there are at least guarantees from a quarter of them to commit to a year.

    I have a feeling that Evan and the IPO guy (forget his name, did Alibaba too) are trying something very innovative.

    I've got a target price and a price that if it drops to, I can pull out properly.
     
  8. Bart Kela, Mar 3, 2017
    Last edited: Mar 3, 2017

    Bart Kela macrumors 6502a

    Bart Kela

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    #8
    TWTR IPO-ed at $26, soared to $45 the first day of trading. Today it closed at $15.75.

    Be cautious with these IPOs, especially the social media tech ones.

    FB's IPO was bungled, but it has done well since then. You can't count on that from everyone.

    It is not particularly wise to judge the validity of an IPO as a longer-term investment.

    Cash out early and move on, even if you get hit with short-term capital gains taxes. No sense in losing sleep over an investment like SNAP.
     
  9. Tapiture macrumors 6502

    Joined:
    Oct 1, 2016
    #9
    Hell no. Snapchat is one of the most over-hyped and over-valued IPOs in existance. I am willing to bet Snap will decrease in value in 2017. They have lots of users and are innovative but they don't use their algorithm or personalize a user's experience. Meanwhile, Facebook and Instagram are doing exactly that: tailoring an experience around a user and using algorithms to track user data and use it to personalize the experience. For example, Nike's most viewed Snap got 66k thousand views while their Instagram story got over 800k. Engagement is simply better on Instagram than Snapchat, and brands will learn that and switch advertising to Instagram. Snapchat will decline in value at the hands of Facebook/Instagram, the most agile social media company around.
     
  10. Bart Kela macrumors 6502a

    Bart Kela

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    #10
    SNAP closed at $23.77 today, below its IPO day opening at $24 (the IPO itself was priced at $17). That means that if you did not have access to the IPO prices and bought on the market after the IPO, you've lost money in SNAP.

    Some analysts are saying that the IPO was priced too high and that the 1 yr. target is around $10.

    Probably better to short SNAP.
     
  11. Phil in ocala macrumors 6502

    Phil in ocala

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    #11
    Tell you what...when someone kills you with a gun....we will ask...if the gun actually killed you....
     
  12. Plutonius macrumors 603

    Plutonius

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    #12
    In fairness, he was answering the OP's question.
     
  13. vkd macrumors 6502a

    vkd

    Joined:
    Sep 10, 2012
    #13
    Neither today nor tomorrow nor next week. Nor the week after that, nor next month, nor at any time in the foreseeable future nor in the unforeseeable future.
     
  14. Plutonius macrumors 603

    Plutonius

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    #14
    For those that bought SNAP on the IPO, did you sell it before the bottom fell out ?
     
  15. jpu thread starter macrumors member

    jpu

    Joined:
    Mar 1, 2014
    #15
    I got so lucky with SNAP. I bought at about $24.50/share and sold the next day (day after IPO) for about $27. About a 10% gain!
    It's a bit too risky for me, but if the current selloff continues I may buy some more. In the past, it's had a 7-8% decline and then bounced right back.
     
  16. Plutonius macrumors 603

    Plutonius

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    #16
    Good job !!!

    I hate those short term capital gains taxes though :(.
     
  17. obeygiant macrumors 68040

    obeygiant

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    #17
    Investors who bought into the hype surrounding Snap Inc. are learning a painful lesson about the dangers of radically overpriced stocks. Snap went public in March and soared 44% on its first day of trading, earning a market capitalization in excess of $30 billion. That strong showing was despite the company's horrific financials. Snap produced just $404 million of revenue in 2016, along with a net loss of $514 million.

    Snap's first quarterly report as a public company was a disaster. Revenue of $149 million marked a decline compared to the previous quarter, average revenue per user slumped 14% sequentially, and the number of daily active users rose by just 5%. Free cash flow was negative $173 million. Unsurprisingly, the stock tanked.

    The bad news just kept on coming. Credit Suisse downgraded the stock on Monday, and Morgan Stanley, an underwriter for the company's IPO, followed suit on Tuesday, knocking its price target down to $16 per share. An NYU Stern professor commented on CNBC that same day that investing in Snap "is like driving drunk," claiming that it's "the most overvalued company in the world." While hyperbolic, I don't disagree.

    Snap stock has now fallen below its IPO price, tumbling about 40% from its post-IPO peak. Those hoping for a rebound should remember that, even now, the company is valued at an incredible $18 billion, nearly 45 times sales. There is no justification for that valuation. While the stock price will fluctuate, it has nowhere to go but down in the long run.

    Just plain crazy
    How much is Snap really worth? If you're extremely generous and assign it the same price-to-sales ratio as the uber-profitable Facebook, a little over $6 billion, or just one-third of the current market capitalization. If you instead assign it the same price-to-sales ratio as Twitter, another perennially unprofitable social media company with a stagnating user base, Snap would be worth just $2.3 billion.

    One problem that may prove insurmountable: The core features of the Snapchat app are being copied. Facebook's Instagram now offers similar functionality through Instagram Stories, a feature that boasts 250 million daily users compared to Snapchat's 166 million. Snap has been adding more features, including Snap Map, which allows users to see where people are posting stories nearby. But there's no reason to believe that the larger social media giant won't continue to copy Snapchat's best features.




    Evan Spiegel should have sold Snapchat to Facebook for 3 Billion back in 2013. Now its a cautionary tale.
     
  18. Plutonius macrumors 603

    Plutonius

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    #18
    Snap is now down in the $13 dollar range. Did you take the risk and buy more ?
     
  19. Bart Kela macrumors 6502a

    Bart Kela

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    #19
    This is a bad time to buy SNAP, even as it flirts with its all-time low. The lockup period ends July 31st, after which some company insiders can start selling shares. Without a doubt, there will be more shares on the market which will drive down share price. How much lower? I'm no economist, but I'm thinking that it'll be lower than $13.

    Unfortunately, the prospects for Snap aren't good. They aren't profitable and their primary competitor is Instagram, owned by King Kong Facebook. Whatever innovations Snap comes up with, Instagram simply copies.

    Highly risky gamble. Maybe day traders can figure this out, but for the typical trader, Snap is not looking all that rosy.
     
  20. Peace macrumors Core

    Peace

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    #20
    I don''t even know what it is.

    :eek:
     
  21. obeygiant macrumors 68040

    obeygiant

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    #21
    Thanks to a flurry of good news, the embattled camera company saw its stock rise 7% Tuesday to close at its highest level in more than a month. And if you’re keeping score at home, Tuesday’s close at $14.53 translates to six positive days in the last seven. Essentially, after punishing long investors over the past three months, SNAP stock has bottomed and is now moving upward with strong momentum.

    After such a strong move, I would not recommend new money to enter this stock, as I expect a pullback to occur at some point. But current shareholders, those who own the stock at an average price north of $17, can use this current level to average lower. From Tuesday’s close of $14.53, long investors can earn 17% as the stock is a sure-bet to regain its $17 IPO price at least before the end of September. And if you have a longer-term holding period, as I do, SNAP shares are poised to close out the year between $23 and $25, if not higher.

    link
     
  22. Plutonius macrumors 603

    Plutonius

    Joined:
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    #22
    Good advise.

    For some reason, many investors seem to buy high (any stock) and sell low :(.
     
  23. Pikachuguy macrumors newbie

    Pikachuguy

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