Snap dives 40%, hits new 52-week low as analysts slam 'remarkably disappointing' Q2
stockcam

Snap (NYSE:SNAP) shares hit a new 52-week low on Friday, losing nearly 40% of their value, after the social network and camera company posted second-quarter results that some analysts said were "remarkably disappointing," and caused several of them to downgrade the stock.
Benchmark analyst Mark Zgutowicz, who still has a buy rating on Snap (SNAP) shares, said the company is suffering from both fundamental problems and issues with the broader economy.
"[Operating on first party data] certainly appears to be a greater work in progress than we had earlier pointed out given the magnitude of the near-term revenue decay," Zgutowicz wrote in a note to clients, adding that company management pointed out this caused "significant and immediate ad budget cuts" on the company's platform.
And while the poor results dragged down the stocks of other advertising-centric stocks such as Meta Platforms (META), Alphabet (GOOG) (GOOGL) and Pinterest (PINS), the pain that Apple's (AAPL) changes to iOS inflicted upon them happened earlier and may not have been hit as bad, due to not implementing fingerprinting, while Snap did.
Pinterest (PINS) fell 13.5% on Friday, while Meta (META) and Alphabet (GOOG) (GOOGL) fell 7.5% and nearly 6%, respectively. 
Twitter (TWTR), which also reported second-quarter results, bucked the trend to gain 1%.
Evercore ISI analyst Mark Mahaney downgraded Snap (SNAP) to a rating of in-line, noting that while second-quarter revenue was "modestly" below Wall Street expectations, EBITDA and daily active users were ahead of expectations. However, the lack of formal third-quarter guidance and the continued headwinds of macro, iOS changes from Apple (AAPL) and competition resulted in a cut.
"We had expected soft SNAP results, but the magnitude of the weakness still surprised us, with our [2023] Revenue & EBITDA estimates coming down a very material 25%+," Mahaney wrote. "When fundamentals change this dramatically, itâs hard for us not to change our investment opinion, however belated the call."
Mahaney added Snap (SNAP) still has "impressive" user growth and several "sizeable" untapped opportunities, such as Spotlight, Maps, AR Shopping, but they are not likely to be meaningful in terms of revenue generation over the next 6-12 months. The analyst also noted that some of the ad budget that was on Snap (SNAP) may have returned to Meta Platforms' (META) Facebook, citing channel checks.
Goldman Sachs analyst Eric Sheridan downgraded Snap (SNAP) to neutral from buy and slashed the price target to $12 from $25, pointing out that Snap (SNAP) does not have much going for it in the short-term.
"Looking forward, we expect Snap as a stock to be range bound for the short/medium term as investors digest a new normal of depressed revenue growth, optimized hiring cadence (while still making investments in platform evolution) and low/no visibility as to improved operating performance," Sheridan wrote in a note to clients. 
Several other investment firms downgraded Snap's (SNAP), including Stifel, Truist, Oppenheimer and J.P. Morgan. In total, eight firms downgraded the company on Friday, following the results.
Credit Suisse analyst Stephen Ju lowered his 2022 and 2023 estimates on Snap (SNAP) on back of the report and guidance, noting that it's tough sledding ahead for the Evan Spiegel-led company. 
"As we have noted, advertisers are starting to retrench budgets into the highest ROI destinations and amidst flattening budget growth for [second-half of the year], itâs progressively more difficult for Snap to claim share," Ju wrote. 
Analysts have been mixed on Snap (SNAP). It had an average rating of HOLD from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates SNAP a STRONG SELL.