Snap revenue estimates for Q4, 2018 'overly optimistic,' says Deutsche Bank
Deutsche Bank analyst Lloyd Walmsley remains cautious on Snap's revenue outlook for Q4 and 2018. Conversations in the advertising community highlight continued challenges scaling spend, Walmsley tells investors in a research note. He sees Street consensus revenue estimates as "overly optimistic" for Q4 and 2018. The analyst notes, however, that his firm's December user survey showed strength in engagement, with Snap's self-serve ad system data slightly improving Q4 daily active user trends. Solid engagement trends "buy time for Snap and underscore its strategic value," Walmsley argues. He keeps a Hold rating on Snap with a $13 price target. The analyst awaits "more concrete signs of an ad spending ramp" before becoming more constructive on Snap shares.