Snap Hit by “Significant Headwinds”
This also impacts Facebook.
Today is Friday, October 22, 2021.
Snap Hit by “Significant Headwinds” in Earnings
Shares of Snap (NYSE: SNAP), the parent of social media platform Snapchat, fell 21.53% in after-hours trading after CEO Evan Spiegel said that the company is experiencing "significant headwinds."
Numbers: Snap reported earnings per share of 17 cents, which was better than what was projected. Its revenue of $1.07 billion was slightly under the forecast.
Headwinds: The company cited numerous challenges, including privacy changes on iOS devices that limit advertising targeting, global supply chain issues, and labor shortages.
Bigger Picture: Several other social media stocks also dipped too, as investors realized that the global supply chain problems could hurt the entire sector. After all, if advertisers are suffering from supply chain woes, that could indirectly impact social media companies.
Stock Price: Before the earnings, shares of Snap were up 92% in the past 12 months.
Final Thoughts: Will the limited ad targeting have a long-term impact on Snap?
Notable Earnings Today: American Express (NYSE: AXP), Honeywell (Nasdaq: HON), VF Corp (NYSE: VFC), Boston Beer (NYSE: SAM), Schlumberger (NYSE: SLB), Seagate Technology (Nasdaq: STX).
Notable IPOs Today: Aris Water Solutions, Inc. (NYSE: ARIS), Marpai, Inc. Class A Common Stock (Nasdaq: MRAI), Augmedix, Inc. Common Stock (Nasdaq: AUGX), Minerva Surgical, Inc. Common Stock (Nasdaq: UTRS), Xilio Therapeutics, Inc. Common Stock (Nasdaq: XLO)
Notable Equity Crowdfunding Campaigns Ending Today: Rangoon (MainVest), CTC Ventures (Fundanna), GreenLifeTech (Wefunder), Voghera Apericena (MainVest).
Notable Economic Events Today: Markit manufacturing PMI (9:45 a.m. ET), Markit services PMI (9:45 a.m ET).
Shiba Inu: Pros vs. Cons
To buy Shiba Inu or to not buy Shiba Inu - let’s go over the pros and cons of buying this surging cryptocurrency.
Good Value: Even though Shiba Inu coins are up 200% in the last few weeks, it is still worth less than 1 cent. Thus, there’s a low price to enter.
Ethereum: Shiba Inu is Ethereum-based, which ties it to one of the other large cryptos.
Good Fundamentals: Another benefit is that it has a healthy market cap and trading volume.
No Innovation: Sadly, the coin is not innovative. It is tied to the Dogecoin revolution and doesn’t offer any unique blockchain technology.
Competition: With so many meme coins flooding the market, Shiba Inu faces a lot of competition.
Volatility: Similar to other cryptos, Shiba Inu’s price is also volatile.
Final Thoughts: Shiba Inu, whether you buy it or not, is available on most crypto platforms.
Trump-Based DWAC Becomes Meme Stock
Shares of Digital World Acquisition Corp. (Nasdaq: DWAC) increased 356% on Thursday after news broke that the company plans to merge with a planned social media platform created by former President Donald Trump.
Background: Digital World Acquisition is a special purpose acquisition company (SPAC), which is essentially a shell company that only exists to raise money on the public markets before acquiring a private company.
Details: The social media platform has not officially launched yet and is reportedly called Truth Social.
Meme Stock: DWAC was one of the most talked-about stocks on Reddit yesterday, and its 1-day surge based on no revenues basically qualifies it as a meme stock.
Final Thoughts: Be careful when investing in a SPAC stock because they can be risky.
Trends to Watch
Two Years in the Making: WeWork stock starts trading, two years after an aborted I.P.O. (New York Times)
It Begins: Walmart Has Quietly Begun Hosting Bitcoin ATMs (Coin Desk)
Don’t Toy With Me: Mattel Beats Sales Estimates Thanks to Rising Consumer Spending. The Stock Is Up. (Barron’s)
Long-Term Problem: Intel CEO warns chip shortage won’t end until at least 2023, as laptop sales get hit by supply issues (The Verge)
More Cancellations: SkyWest cancels 700 U.S. flights over technical issue (Reuters)
Thank you for reading! Please share this newsletter with a friend.