Snap surges after Wall Street heavyweights reveal stakes
Snap Inc (N:SNAP) jumped 8 percent on Monday and was on track for its third strongest day since the social media company’s initial public offering, boosted by filings showing several institutional investors had owned its shares.
Leading investment firms Fidelity and BlackRock Inc (N:BLK) owned Snap shares at the end of March, regulatory filings showed, providing a fresh vote of confidence for the Snapchat parent company. Its stock had plummeted 23 percent late on Wednesday after its debut quarterly earnings report disappointed investors.
Snap’s high valuation, lack of profitability and slowing user growth have made it a controversial stock on Wall Street since its IPO on March 1, which was the hottest technology offering since Facebook’s in 2012.
Snap’s stock is valued at 44 times the company’s expected sales for the next 12 months, according to Thomson Reuters data. By comparison, Facebook (O:FB) trades at 14 times expected sales, and Alphabet (O:GOOGL) is at 7 times expected sales.
Among investors who late on Friday reported owning shares of Snap at the end of March were Daniel Loeb’s Third Point and Daniel Och’s Och-Ziff Capital Management (N:OZM).
Snap’s stock was last up 7.75 percent at $20.62. It remains up 22 percent from its $17 IPO price but down 23 percent from its highest closing price on March 3.