Snap Inc SNAP has put up a strong performance in 2020, and one analyst said Tuesday the company’s latest numbers from the month of August suggest Snap’s momentum is continuing in the second half of the year.
The Snap Analyst: Bank of America analyst Justin Post reiterated his Buy rating and $28.50 price target for Snap.
The Snap Thesis: Post said Snap’s monthly ad manager user count is up 7% to 421.7 million since the end of the second quarter. Post said growth numbers in Europe over the past two months are particularly impressive, including France (12%), Germany (12%) and the UK (9%).
SensorTower app download data for August was also extremely impressive. Downloads were up 29% year-over-year in August compared to 9% growth in July. Post said Snap had the largest number of gross monthly downloads in August than in any month since May 2019. US downloads were down 6% in August compared to a 19% decrease in July.
With the U.S. election fast approaching, Post is also tracking the ramp in political ad spend and pricing. Snap had an estimated $525,000 in political ad spending in August at $5.25 CPMs, up from $3.07 CPMs in July.
“We believe Snap and 3P data points suggest a solid month of August, though September is the most important month in 3Q and uncertainty remains in forecasting spending/engagement around back to school,” Post wrote in a note.
Benzinga’s Take: Snap guided for above 20% revenue growth for the third quarter, which is a high bar to clear. However, numbers from July and August suggest Snap is on track to report an impressive quarter assuming it stays on track in September.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.