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Greg Sandoval / Business Insider
- Snap shares rebounded Friday after receiving an upgrade from Pivotal Research.
- The current price of the action makes the company an "attractive candidate to go private" if management can not reverse the trends of its use, said Pivotal Research.
- Shares have lost more than 60% of their value since Kylie Jenner tweeted her dissatisfaction with the redesign of the Snapchat app in February.
- Watch Snap transactions in real time here.
Snap shares rose to 8.5% Friday after receiving an upgrade at Pivotal Research, which said the company was an "attractive candidate for privatization" if management failed to reverse the current trends in use.
"We believe that it is not too late for management to find ways to reverse recent usage trends and generally improve monetization, regardless of what is happening. Usage trends, "said Brian Wieser, an analyst at Pivotal Research, in a note sent to clients on Friday.
"If they are unable to do so in the short term, the company could become an attractive candidate to go private with the price of action at current levels."
Snap's shares have been turned upside down this year, recording a drop of more than 60% since February, after the infamous tweet of Kylie Jenner that has blasted the redesign of the Snapchat app. The sale has since disappeared $ 13 billion in market value.
The redesign, which was unpopular with users, resulted in another problem: a declining user base. The company said in its release of the second quarter results on August 7, it suffered the first decline in its number of sequential daily active users. Shares have plunged more than 45% since the announcement of these results.
The manufacturer of the application has constantly introduced new features, but this has not allowed to raise shares.
Last month, Snap introduced a new feature called Visual Search, which allows users to point the camera's application on shoes, jackets and other products to find them on Amazon and buy them. Shares fell 2% that day.
Similarly, equities fell by 4% when Snap introduced two new styles of spectacle spectacles Spectacles.
On Wednesday, Snap launched its new scripted shows, called "Snap Originals", but stocks fell more than 3% to a record low of $ 6.45 each.
But Pivotal Research says all negative news has been incorporated into the price and that equities should rebound. This led the company to upgrade Snap to "buy" to "hold". The company, however, lowered its price target from 9% to 8%, which is 12 to 12% higher than the price at which the stock is currently trading.
Snap was down 52% this year.
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