Welcome to "#SocialStocks," The Fly's weekly recap of Wall Street's reactions to social media stock news.
FACEBOOK PRIVATELY TESTING SWIPEABLE CAROUSEL: On Monday, April 15, TechCrunch reporter Josh Constine wrote that Facebook (FB) is testing a removal of the News Feed in favor of a swipeable content delivery system that combines stories and what we know as News Feed posts. Constine added in an update to this story that Facebook confirmed that this feature is in the “very early-stage prototype” of a new navigation method.
FINANCIAL TIMES SAYS SNAP COULD RUN OUT OF CASH IN 3 YEARS: On Tuesday, April 16, Financial Times' reporter Elaine Moore wrote that Snap (SNAP) has had a $68M average monthly cash burn since going public in 2017 and may potentially run out of cash in three years unless it turns a profit. Moore added, citing sources, if Snap, which has faced a disastrous Snapchat redesign, a delayed update for Android users, a number of executive departures and rivals like Facebook (FB) copying features, can maintain last quarters strict cost controls average monthly cash burn can drop to $33M giving the company over three years to raise user numbers before it needs new funds.
TWITTER TO ADD “HIDE REPLY” TO REPORTING PROCESS IN JUNE: Continuing in its effort to stem bullying and harassment on its platform, TechCrunch reporter Sarah Perez wrote, Twitter (TWTR) is launching a feature to hide a reply to its reporting process in June. Perez added that the addition may spark controversy, as it puts the original poster in control of the thread, which could lead to silencing fact-checking replies, but it also means that users who comment with the intent to troll or harass the original poster will not have their replies seen.
DA DAVIDSON INITIATES PINTEREST WITH NEUTRAL RATING: DA Davidson analyst Tom Forte initiated Pinterest (PINS) with a Neutral rating and a price target of $16. The analyst said the company offers consumers an "impressive visual-based discovery platform for merchandise" and advertisers "a large and growing global base of consumers with purchase intent" - a combination that he believes will "translate into long-term sales and profitability growth." However, Forte also said he sees the valuation for Pinterest already reflecting his favorable view of the company's growth prospects. The analyst added that the potential catalysts for Pinterest stock to trade higher in the next 12 months include "product improvements for advertisers, efforts to drive international usage and monetization, and expansion into new content verticals."