Rosenblatt Securities initiated coverage on the equity with a "buy" rating
Snap Inc (NYSE:SNAP) is up 3.6% to trade at $33.81 this afternoon, after Rosenblatt Securities initiated coverage on the equity with a "buy" rating, and a $49 price target. This bull note comes just a couple of days ahead of the social media company's first-quarter earnings report, due out after the close on Thursday, April, 21. Below is a breakdown of SNAP's recent chart performance, as well as a look into how the stock usually fares post-earnings.
Digging deeper, Snap stock has struggled with a ceiling at the $42 level for most of the year. The shares' recent rally failed at the 80-day moving average earlier this month, and year-to-date, SNAP is down 27.9%.
The last time we checked on the security, it was enjoying its first-ever quarterly net profit. The equity has a positive history of post-earnings reactions, finishing six of eight next-day sessions higher in the past two years, including a massive 58.8% jump in February. This time around, options traders are pricing in a 26.8% swing for SNAP, which is higher than the 24.6% move it averaged following its last eight reports, regardless of direction.
An unwinding of pessimism in the options pits could create additional tailwinds for Snap stock. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), SNAP's 10-day put/call volume ratio of 1.16 stands higher than 96% of readings from the past 12 months. This indicates that puts have been picked up at a much quicker-than-usual clip in the last two weeks.