Shares of Snap Inc. rose 4.5% Monday hot on the heels of many “buy” ratings issued by the research divisions of banks that underwrote the company’s initial public offering earlier this month.
The stock closed at $23.83 after riding higher than the $24 IPO opening-price level for much of the day. The boost countered initial bearish assessments from analysts that suppressed Snap shares during its first few weeks on the market.
But Monday marked the end of a 25-day quiet period for banks that supported Snap’s IPO. Citigroup, Deutsche Bank, Credit Suisse and Goldman Sachs were among the analysts who issued rosy outlooks for the Snapchat parent company.
“Snap looks well positioned for growth as advertisers clamor to serve ads to its large audience of deeply-engaged users, many of whom are in the attractive millennial demographic and are located in high-value ad markets,” wrote Jefferies analyst Brian Fitzgerald, who also issued a buy rating.
In an “outperform” rating issued by Cowen & Co. analyst John Blackledge estimated that Snap would more than double its 2016 revenues this year to just over $1 billion and eventually take approximately 5% share of the booming global mobile advertising market by 2022.
Snap shares have been on a roller-coaster ride since IPO, rocketing 59% on its first few days on the market before dropping low double-digit percentages in subsequent weeks. Last week, Snap shares found their footing, posting a 16% gain.