Why Snap Inc. Shares Could Leave Investors Ghosted
In the highly competitive social media landscape, shares of Snap Inc (NYSE: SNAP) are currently shining the brightest. After three years of neutral performance, the stock has awakened to return 364% over the last 12 months. Increased revenue and daily active users have investors excited -- but behind those appealing metrics, there are plenty of reasons to pump the brakes.
Image Source: Getty Images
Snap does have some favorable trends developing. Daily active users -- a key metric -- grew 21.6% year over year to 265 million in 2020, accelerating from 17.2% growth the year before. More impressively, revenue per user was up 33% in 2020. These combined to help Snap shrink its cash burn by about a third, from -$341 million to -$225 million.
Source Fool.com
