Tags: Barrons | Snap | Stock | Price

Barron's: Snap's Stock Price Hard to Justify

Image: Barron's: Snap's Stock Price Hard to Justify
(AP/Frank May)

Sunday, 05 Mar 2017 07:35 PM

Snap Inc.'s share price looks overvalued following a surge in the wake of its much-anticipated initial public offering last week, according to an article in Barron's.

Shares of the messaging app company closed at $27.09 on Friday, well above its IPO price of $17 per share set on Wednesday.

The owner of Snapchat, an app popular with young people for its disappearing messages, raised $3.4 billion in its IPO.

According to the Barron's article, Snap (SNAP) is valued at about 34 times its projected 2017 revenue of $1 billion, based on its enterprise value, while Facebook is valued at 10 times sales.

Even if strong growth is assumed, it is hard to justify more than half the current stock price, Barron's said.

© 2017 Thomson/Reuters. All rights reserved.

 
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StreetTalk
The parent of Snapchat surged 50% from an already full IPO valuation. Investors will need to be very patient.
Barrons, Snap, Stock, Price
122
2017-35-05
Sunday, 05 Mar 2017 07:35 PM
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