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Although Snap did not disclose the financial side, it is expected that StreetCred will shut down its platform as part of the acquisition deal.
Snap Inc (NYSE: SNAP) stock jumped 3.13% on Monday to close the day trading at $54.38. Meanwhile, SNAP shares were up approximately 1.25% during Tuesday’s premarket. The spike is attributed to news that Snapchat’s parent company Snap has inked a deal to acquire a New York City startup building a platform for location data StreetCred.
Being an entertainment-based company amid the ongoing coronavirus pandemic, Snap stock has significantly benefited over the past twelve months. Market data provided by MarketWatch indicates that Snap stock rose over 200% last year, whereby half of the gains were materialized in the past three months.
Notably, the company has a reported market valuation of approximately $78.57 billion with 1.23 billion outstanding shares.
Over the past few months, Snap stocks have been rated 39 times and managed to receive an average of Over rating. Both investors and Wall Street analysts are optimistic the company can continue with the uptrend based on its market fundamentals.
Speaking to news outlet TechCrunch, Snap noted that the acquisition will come in hand with StreetCred team members. Whereby it is expected that four of the team members including co-founders Randy Meech and Diana Shkolnikov will join the company to further develop and integrate seamlessly.
StreetCred Acquisition by Snap
Although Snap did not disclose the financial side, it is expected that StreetCred will shut down its platform as part of the acquisition deal. One of the biggest beneficiaries of the StreetCred acquisition is the Snap map feature. Whereby the integration is expected to make the services more user-friendly and seamless. Snap map was inspired by the company’s acquisition of social map app Zenly for up to $350 million.
With StreetCred onboard, Snap users can be assured of a better experience in exploring what is happening around them including finding your friends.
According to the company’s metrics, Snap map has managed to reach 200 million users every month, thus a major component for its future growth prospects. Snap is ostensibly competing with other social media platforms including Facebook for the same global users. Any enhanced feature could mean a huge difference in the market reception.
Data from its third-quarter 2020 financial results indicated its daily active users increased 18% year-over-year to 249 million. Hereby resulting in a revenue spike of 52% year-over-year to $678 million.
Notably, Snap developers have been working on augmented reality capabilities on the platform, which saw a tremendous adoption by the third quarter. “The adoption of augmented reality is happening faster than we had previously anticipated, and we are working together as a team to execute on the many opportunities in front of us,” said Evan Spiegel, Snap CEO.