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Tematica's Thoughts On Snap's IPO, $34.7 Billion Valuation and GoPro

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Michelle Briggs

Last Thursday, March 2, shares of Snapchat parent went public at $17, well above the $14-$16 initial public offering range.

With SNAP shares now trading in the secondary market and the buildup of the IPO now behind us, the question to us is are SNAP shares really worth the current $34.7 billion in market capitalization?

Odds are the IPO underwriters, which include ,, and , that made from the transaction, will have some favorable research comments on SNAP shares in the coming weeks.

While SNAP shares fit within the confines of our investing theme and are likely to benefit from the shift in advertising dollars to digital and social media platforms like Facebook and Google and YouTube, our charge is to question using our thematic 20/20 foresight to see if enough upside in the shares exists to warrant placing them on the Tematica Select List?

There are other reasons to be skeptical, including users migrating to newer social media platforms or ones that have been updated like Facebook’s Instagram that launched Stories to better compete with Snapchat.

Making things a tad more complicated is the recent push back on digital advertising by Chief Marketer Marc Pritchard, who publicly expressed his misgivings with today's digital media practices and, As Pritchard made those and other comments, a survey from the World Federation of Advertisers showed that large brands are reviewing contracts related to almost $3 billion of advertising spend on programmatic advertising, which automates digital ad placement.

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Michelle Briggs
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