Snapchat said EBITDA would be at the low end of guidance, going at low as ZERO for EBITDA. They also said, and I quote: “the macroeconomic environment has deteriorated further and faster than anticipated.”
This pairs well with the recent FB warning and NFLX collapse, leading all to believe the entirety of the ad spending space is in turmoil.
The reason for the 40% rape today is no one saw it coming. As a matter of fact, SNAP just offered guidance last month, so whatever the fuck is happening now happened very recently.
This is having a deleterious effect on all social platforms, also extending into ad companies like TTD, PUBM, MGNI, OMC and IPG, amongst many others. It’s doom cast all over again and shares of ROKU can’t seem to find a bottom, now trading at 3.5x sales — way way down from its high of 28x reached in 2020. These stocks are certainly “cheap” based on where they were then and where they are now. At 3.5x sales, one has to assume ROKU is worthy of money down here. But the only thing about looking at valuations now is the fact that we have yet to see sales decline. Once we get 20-30% downward revisions in sales, then perhaps we can look at valuations and determine if we’re near a bottom.
Presently, I am not hedged, long old man and a few commodities, down 84bps.If you enjoy the content at iBankCoin, please follow us on Twitter