Analyst Note
| Ali Mogharabi |Snap’s first-quarter revenue easily exceeded expectations while losses were slightly higher than the FactSet consensus estimates. The firm posted strong top-line growth driven by higher user count and monetization as advertisers are no longer just testing Snap’s platform. Higher losses were mainly due to Snap’s more aggressive investments in marketing to further increase the firm’s ad client list. We have increased our projections as Snap’s user growth, higher monetization, and attracting more advertisers, which are indicative of a possible network effect, are likely to continue. We now value the stock at $68, up from $64, leaving the shares near fair value.