Goldman Sachs says Snapchat will grow by 45% on product-based revenue growth

• Snap Inc., Snapchat’s parent company, will grow 45% as its product growth picks up faster than expected revenue growth, Goldman Sachs said in a note Monday.
• Goldman reaffirmed its buy rating on Snap shares and set a o 7o price target for the company.
• Shares of Snap rose 11% in Tuesday’s trading on the note from Goldum.
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Snapchat Parent Snap Inc. If Goldman Sachs’s analysis proves to be correct, there are plenty of places on the upside.

In a note on Monday, Goldman reaffirmed its buy rating on Snap and set a price target of 70, indicating a potential 45% close to Monday.

The note helped Snap’s shares rise 11% in Tuesday’s trading.

Goldam does not believe that the recent first number of innovations and product partnerships from Snape, combined with a favorable macro backdrop for online advertising, will “increase the likelihood of accelerating revenue growth better than predicting a Q4 and beyond consensus.”

Instant is expanding its advertiser base and user engagement on its distribution platform continues to grow, Goldman noted.

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“Snape’s Spotlight product, new advertising campaign objectives and bid types and engagement partnerships are likely to further accelerate engagement growth as well as provide a valuable scale to advertisers.”

Moreover, Goldm’s channel checks indicate that Snap may exceed its growth forecast.

“Our checks with advertisers, along with recent third-party application data, indicate that despite the uncertainty surrounding the impact of the November election and the resurgence in COVID-related lockdowns, the strength of the brand and direct response has continued into the holiday season. Is that% -50% Y / Y growth is achievable if the holiday season is obtained in conjunction with previous years, ”Goldman explains.

“We now expect revenue growth of 58% Y / Y, which demonstrates that strength.” Goldman added.

Snap’s shares have risen 196% year-over-year since closing on Thursday.