Dying Snap Snapchat Proves That Silicon Valley Smoke and Mirrors No Longer Works

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Snap shares hit new low in choppy trading as valuation concerns mount

Traders gather at the post where Snap Inc. is traded on the floor of the NYSETraders gather at the post where Snap Inc. is traded on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 6, 2017. REUTERS/Brendan McDermid
 

(Reuters) – Shares in Snap Inc hit a fresh low on Wednesday, falling as much as 2.6 percent before clawing back some losses in choppy trading as analysts questioned the company’s prospects.

In its tenth day of trading after its $3.4 billion public listing, the owner of the Snapchat messaging app was last down 0.9 percent at $20.40 after hitting a low of $20.05 in the first few minutes of trade.

Snap has raised some eyebrows on Wall Street, with analysts flagging the company’s slowing user growth, widening losses and lack of voting rights for outside investors.

Cantor Fitzgerald kicked off its coverage of Snap with an underweight rating and a price target of $18, just a dollar above its initial public offering pricing.

Trading in Snap’s newly launched options has largely leaned towards defensive bets, but the sharp declines after a flashy market debut have started to draw some bets on shares stemming their losses in the near term.

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