1 stock less than 18 % to buy and keep 10 years

The process of selling the last stock market decreases to the bottom of many companies, including pop (NYSE: Snap)Social media professional. Although the company ended in 2024 with strong momentum, its shares have decreased by 18 % since January. However, there are good reasons to be optimistic about the surprise. The company’s long -term horizons appear attractive despite the past few years. Read more to learn more.

Snap, the parent company of Snapchat, has publicly traded in March 2017. Since then, the company’s performance has not been impressive, to put it moderate. the Technology leader I faced several problems. For example, but not limited to, copy some social media platforms, the devastating photo model for self -presentation and videos; ISOS update is difficult for the company to launch targeted ads; A great slowdown in advertising spending, amid economic challenges, led to worse revenues than expected.

The result was inconsistent with upper growth and continuous net losses, which is not a recipe for success for any company. However, Snap’s financial results during the past year, including the fourth quarter, were very strong. The company’s revenues of $ 1.6 billion for this period increased by 14 % compared to the previous quarter. Snap turned into a net income of $ 9 million compared to a net loss of $ 248 million that were reported in the fourth quarter of 2023, while its modified profits before interest, taxes, consumption and firefighting (EbitdaIt fell at 276 million dollars, an increase of 73 % compared to the past period.

Several other main measures, including Snap -free cash flow. Snap Q4 results were not just a coincidence. The company’s business improves and can provide excellent results over the next decade.

Snap still makes most of her money from ads. Therefore, it is important for the company’s platform to continue to develop its users. A social media specialist is making progress. In Q4, daily active users in Snap (DAU) increased by 9 % year -old to 453 million. In addition, Snap continues to launch features on Snapchat that helps increase participation, with popular artificial intelligence (AI).

In Q4, the Snapchat “Me in the 60’s” feature is seen, a feature that creates an image of what the user will look like in the 1960s, more than 900 million times. As long as Snap has an increased base of users who participate in projects like these, Snapchat will be a good goal for companies looking to reach potential customers. In recent years, the company has improved the advertising platform thanks to machine learning.

However, Snap is looking to diversify its revenue sources. One of the best efforts of the company is Snapchat+, a subscription option that has been rising in the past few years. Snap indicated that its “other revenues” grew by 131 % year on an annual basis in 2024 and ended the year with an annual operating rate of more than $ 500 million. Most of that comes from Snapchat+. These subscriptions provide a fixed and reliable source of revenue for the company. Looking at the current operating rate, Snapchat+ should contribute useful to Snap results in the next few years.

Moreover, Snap continues to invest in its long -term plan to be a augmented reality (AR). The AR -based features, which are increasingly operating in Amnesty International Obstetrics, help to increase participation. Here is what all this can mean for the future of the company. Snap still sees an important space for the development of active monthly users (MAUS) on Snapchat, bearing in mind that the penetration of smartphones in North America is only 22 %. It is less in other areas, so the company has a large white space.

Although there are other social media platforms, Snap has created itself as a leader – it provides a somewhat different experience from its peers. With the expansion of Snap’s Maus, the company offers newer features to develop participation, advertising revenues and Snapchat+ subscriptions that must increase in a good clip. Meanwhile, Snap’s profitability should continue to improve.

Therefore, although it is a disappointing stock since its initial general offer (IPO), Snap can manage things and provide stronger returns from here by ascending thanks to a more diverse base of revenues and artificial intelligence features that help improve participation and efficiency through the company’s business, including on the advertising platform. For this reason the Snap 18 % decrease this year represents an excellent opportunity for long -term investors.

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Prosper Junior Btyy He has no position in any of the mentioned stocks. There is no position in Motley Fool in any of the mentioned stocks. Motley deception has Disclosure.

1 stock less than 18 % to buy and keep 10 years It was originally published by Motley Fool

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