Snap Stock: Bull vs. Bear Case | The Motley Fool

Is this social media powerhouse worth your investment money? Key Points A key advertising demographic uses Snap’s platform. Valuation and concentration risk are concerning for the company. For better or worse, social media is a huge part of society. Billions of people interact with it daily, so advertisers spend heavily to better reach their intended audiences. Because of this, social media companies often make great potential investments. Snapchat is a popular platform owned by Snap (NYSE:SNAP). Is this social media play worth an investment? IMAGE SOURCE: GETTY IMAGES Bull Case: Snap has captured a key demographic and is optimizing revenue Keithen Drury: Different than other social media companies, Snapchat is a communication platform. Rather than scrolling through feeds or advertisements, the primary use is sending pictures back and forth to friends. Snapchat popularized filter use, which is just one way it generates revenue. It also has programmed content with ads placed between segments, similar to television ads. Snpachat is in its second growth phase: maximizing revenue. Third-quarter revenue grew 57% year over year to more than $1 billion. Year to date, it has increased 77% to $2.8 billion. Management is guiding for around $1.2 billion in the current quarter, making…
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