Snap shares may be losing a bit of cache among young investors.
The under-30 crowd, the biggest users of the company’s disappearing photo app, were initially hot on the stock when it debuted on the public markets in early March. But, judging by brokerage data and social media platforms, that enthusiasm appears to have cooled a bit going into an earnings report Wednesday in which the company showed that is was struggling to maintain strong user growth as it competes with larger rivals like Facebook.
The stock was down as much as 23% in the first minutes of trading Thursday, falling to an all-time low of $17.59. Snap began its life as a public company at $24 per share and jumped as high as $29.44 in the early days of trading. But it has since retreated, and hasn’t closed above $24 since early March.
On Robinhood, an online brokerage platform with a younger clientele, sellers of Snap shares outnumber buyers among users under 30. Ahead of the earnings report, the ratio of those Snap buyers to sellers was 0.80, meaning 80 hypothetical buyers of the stock for every 100 sellers. In the week after the IPO, there had been 280 buyers for every 100 sellers. For those over 30, Snap’s buy-to-sell ratio is currently 1.2 times, down from 3.1 times the week of the IPO.
StockTwits, a social media platform used for sharing trading ideas, has seen the relative share of messages about Snap that are bullish turn lower in the last few days, though it’s generally trended higher since the IPO, according to a 10-day rolling average of company data.
More than two months after the IPO, though, it’s clear Snap’s stock is still trending on financial social media. On Trigger, a mobile investing app that uses alerts to notify investors of market moves and information, the fourth most popular notification, or “trigger,” is for when Snap stock drops below $17 per share. That’s the price at which Snap sold shares to its IPO investors, but the stock has never traded that low in the open market.
On the app, whose average user age is about 30, Snap is the most popular traded name by number of people trading it, even beating out Apple, a close second. Users trade in the app through linked brokerage accounts.
Rebecca Shoenthal, who is due to graduate from the University of North Carolina at Chapel Hill this weekend, told the Journal in March that she bought Snap shares after their public debut because she was excited about the company.
In a follow-up e-mail Wednesday, she said that, “Facebook is certainly making things hard for Snap, especially since they have essentially the same product with a much larger user base already established.”
She said that she’s, “trying to be patient” with the stock, but will “probably sell” if the shares go up a bit.
May 11, 2017 at 06:53PM
from Ben Eisen
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