Snap shared at the company's Q2 2022 earnings briefing on July 22 that 'macro headwinds have disrupted many of the industry segments that have been most critical to the growing demand for advertising solutions over prior years.' The third headwind or negative factor is macroeconomic weakness.

In my previous article written on February 23, 2022, I highlighted the two major headwinds for SNAP, namely 'Apple's ( AAPL) iOS privacy changes' and 'greater-than-expected competition from rivals', and these have continued to hurt Snap's most recent Q2 2022 results. Specifically, there are three key factors that have been a drag on Snap's financial performance in recent quarters. Snap's second-quarter revenue miss and the company's decision to do away with Q3 2022 management guidance confirmed investors' fears that the outlook for SNAP is moving from bad to worse. On July 22, 2022, a day after it reported its Q2 2022 financial results, SNAP's stock price dipped by -39% to close at $9.96 at the end of the trading day. The first of the three top line misses occurred on Octowhen SNAP announced its Q3 2021 results, and this coincided with the beginning of the stock's underperformance relative to the broader market. Notably, SNAP's revenue fell short of market expectations in three of the past four quarters. Snap's shares were down by -84% in the past one year, and the stock has underperformed the S&P 500 since late-October 2021 as per the chart below. This makes Snap a Hold-rated stock in my opinion. On the flip side, it is premature to be bottom fishing in SNAP's shares, taking into account expectations of weak revenue growth and continued losses for SNAP in the rest of 2022. This is because Snap still has lots of room for growth in international markets, based on an analysis of penetration rates in countries such as Japan.

Snap's shares continued to dip its stock price declined by -39% on Friday, Jafter announcing below-expectations revenue growth, implying that SNAP's stock has now dropped by -84% in the last one year.īut SNAP isn't a Sell despite negative share price momentum and the poor financial outlook for the upcoming quarters.

In this latest write-up, I turn my attention to Snap's share price weakness. In my prior Februupdate for SNAP, I touched on the company's growth prospects in the intermediate term. My investment rating for Snap Inc.'s ( NYSE: SNAP) stock is a Hold.

Should i sell my snap stock