Snap Inc has been a public company for four months now. However, the company is already struggling with a disappointing market price. Snapchat shares plummeted below the initial public offering of $17 for the first time since March 2017. This event signals the side effects of activating in an extremely competitive market.
Snapchat Shares Fell as Low as $16.95
The growing social media platform made an impressive show on the first day of the company appearing in the New York Stock Exchange. Snapchat had its shares jump 40% above the $17 IPO threshold on March 2, 2017. However, the stocks came back to average values soon afterward. It wasn’t until Monday that its shares fell below the original price that introduced the company as a public business.
On July 10th, Snapchat shares reached $16.95 yet the trading day ended at $16.99. Even though the social media network proved to work with volatile factors, this is the first time the value fell so low. The initial market capitalization encompassed $31 million in its second day. By comparison, this value is now barely standing at around $20 million. This loss in just four months is the equivalent of Twiter’s market cap.
Nonetheless, the value oscillations are a common event for any public company, including Facebook, Fitbit or Tesla. However, it is still a painful moment for investors who are expecting Snapchat to deliver its promises. The company attracted shareholders by pledging ad sales and increased user database in the upcoming years.
The Social Media Network Is Constantly Working on Updates for Users
At this moment, the platform hosts 166 million daily account owners. On the other hand, Snapchat is positioned in a vulnerable spot that faces Facebook’s newly acquired Instagram directly. For the time being, the company delayed showing its report for the second financial quarter.
Despite bad news on the stock market, the company still pushes ahead with its innovations. Snapchat users enjoyed new products recently, such as Snap Map that allows a better national and international engagement. On top of that, the company has still yet to introduce a series of monetization methods.
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