Snap Inc. Falls Short Of Expectations

But We Profit – Up 207%!

by Ian Harvey

May 03, 2018




Snap Inc. (NYSE:SNAP)

Here is an update of Snaps winning options put trade after reporting earnings. This options trade was recommended to  Mentorship” members of Stock Options Made Easy on April 30, 2018”; which produced excellent potential profits of 207% -- within a couple of days of executing the trade!


The Trades to Consider……

…….from ““Mentorship program” Recommendations - Week Beginning Monday, April 30, 2018

The Details……..

Snap Inc. (NYSE:SNAP), formerly Snapchat, Inc., a camera company, has continued to disappoint investors. Snap is confirmed to report earnings tomorrow, Tuesday, May 1, 2018, after the market closes.

For the first quarter of 2018, the Consensus Estimate for Snap's total revenues is pegged at $247 million, indicating an increase of 64.7% from the year-ago period. However, the projected increase is lower than the growth rate witnessed in the last reported quarter.

The Consensus Estimate for loss per share stands at 17 cents, narrower than a loss of 20 cents reported in the year-ago quarter but wider than a loss of 13 cents in fourth quarter.

Last report saw the company surprise investors with a strong fourth-quarter performance, beating expectations for revenue, earnings, and user growth. Shares spiked following the report, but the stock has given up those gains in the months since after several high-profile user complaints about the redesign and an offensive advertisement.

Overall earnings estimates have been revised lower since the company's last earnings release.

Option traders are pricing in a 15.5% move on earnings and the stock has averaged a 24.4% move in recent quarters……..continue reading.

The Trade……..

** OPTION TRADE: Buy SNAP MAY 18 2018 14.000 PUT at approximately $1.00 each.

The Result………

Shares of Snap certainly snapped badly yesterday, down by 20% as of 12:30 p.m. EDT, after the company reported disappointing first-quarter earnings results. The controversial redesign of the core Snapchat app has taken its toll.

Revenue in the first quarter rose 54% to $230.7 million, which led to a non- GAAP net loss of $0.17 per share. That top line was well below the consensus estimate of $244.5 million in sales, while the bottom-line result was in line with the Street's expectations. Adjusted EBITDA was negative $217.9 million, and Snap burned through $232 million in operating cash flow.

Future Outlook……

Chief Strategy Officer Imran Khan further rattled investors when he predicted that revenue in the second quarter would "decelerate substantially" from the first quarter. Operating expenses in the first half of 2018 are expected to grow by "low double digits."

Capital expenditures rose modestly to $36 million, mostly due to the company's ongoing move to Santa Monica. The company points out that this spending is "below industry peers," but the difference is that after Snap spends $3 billion in hosting costs through 2021 , it will have nothing to show for it.

The Profit……..

So, for members of the “Mentorship Program” who managed to execute this trade recommended by Stock Options Made Easy; a nice tidy profit already of more than 207% made within 48 hours.

Entering the option trade at a cost of $1.00 or less; reaching as high as $3.07 (before closing at $2.99); one options contract would provide a profit of $307.00.



Now is the time to decide if it is worth continuing to hold this trade or exit on excellent profits. It is nearly always prudent to exit a trade before an unknown incident occurs that could rattle a sound profit, and this is a fine example of such a situation.

As you would have by now realized, many of our trades are based on earnings predictions. This is not to say all trades recommended to members follow this pattern, as seen in this scenario, but during earnings season this strategy has been very profitable.

Our approach is to predict whether a company will beat or miss estimates, whether the stock will appreciate or depreciate as a result and what strategies investors and traders can use. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.

Our proven track record says it all!!

Members of Stock Options Made Easy are provided with an extensive reason as to which direction a stock will move after earnings, followed up by a recommended options trade.

What To Do Now…….

If you interested in being part of this profitable action just click here……

Best of Trading,
Ian Harvey
Director of Stock Options Made Easy


”Success is simple. Do what's right, the right way, at the right time.”

Option Tip for your Success!
Options traders are not successful because they win.
Options traders win because they are successful.

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