Snap shares fall the most in nearly six months on Friday, company reports second consecutive quarter of user losses

Shares of Snap Inc (SNAP) registered their largest single-session drop in nearly six months on Friday, after the company reported its second consecutive quarter of user losses and said it projected a further drop in user numbers.

According to Reuters, Snaps app redesign continued to affect the number of daily active users, especially in the United States and Europe.

Snap shares closed lower for the sixth time in the past twelve trading sessions in New York on Friday. It has also been the steepest daily loss since May 2nd. The stock went down 10.16% ($0.71) to $6.28, after touching an intraday low at $5.77 and also the lowest price level on record.

Shares of Snap Inc have retreated 57.02% so far this year following a 46.07% drop in 2017.

Snap said it had 186 million users during the third quarter, in comparison with over 1 billion users for Facebook Inc’s Instagram.

Snap has now lost five million daily active users since the first quarter, mostly because of the Android app rollout, the company said. As the Snapchat-owner projects more user losses, some Wall Street analysts expressed concerns these losses could continue in 2019 as well.

J.P. Morgan and RBC Capital Markets revised down their price targets on the stock by 50%.

“We believe that Instagram is much more penetrated in these demographics, and it will be challenging for Snap to pull users away from Instagram,” J.P. Morgan analyst Doug Anmuth wrote in a note to clients, cited by Reuters.

According to CNN Money, the 29 analysts, offering 12-month forecasts regarding Snap Inc’s stock price, have a median target of $11.00, with a high estimate of $16.00 and a low estimate of $5.00. The median estimate represents a 75.16% upside compared to the closing price of $6.28 on October 26th.

The same media also reported that 18 out of 37 surveyed investment analysts had rated Snap Inc’s stock as “Hold”, while 8 – as “Buy”. On the other hand, 9 analysts had recommended selling the stock.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Snap Inc (SNAP) are presented as follows:

Central Pivot Point – $6.38
R1 – $6.98
R2 – $7.69
R3 – $8.29
R4 – $8.90

S1 – $5.67
S2 – $5.07
S3 – $4.36
S4 – $3.66