How Much Is Snapchat Stock?

how much is Snapchat stock Right now, Snapchat plans to price shares between $14 and $16 each.

That means Snap Inc. (NYSE: SNAP), the parent company of Snapchat, values its company between $19.5 billion and $22.2 billion.

But Snapchat recorded a net loss of $514.6 million in 2016, which is why investors are asking us why Snapchat has such a massive valuation.

Here's why...

Snapchat Stock Could Soar from Future Revenue Growth

Snapchat's skyrocketing revenue is why the Snapchat IPO is the most hyped public offering of 2017.

This year, Snapchat is projected to generate between $936 million and $1 billion in revenue. By 2018, Snapchat is projected to generate between $1.76 billion and $2 billion.

Year Revenue Year-Over-Year Growth
2016 $404.5 million 597%
2017 $936 million 131%
2018 $1.76 billion 88%

Not bad for a company that launched in 2011.

In comparison, Twitter Inc. (NYSE: TWTR) launched in 2006, and it took Twitter nine years to generate $2 billion in revenue.

Year Revenue Year-Over-Year Growth
2011 $106.31 million 275%
2012 $316.93 million 198%
2013 $644.89 million 103%
2014 $1.4 billion 117%
2015 $2.2 billion 57%

But investing in Snapchat stock solely based on revenue growth isn't a sound investing strategy.

That's because in Snapchat's SEC filing, it said it "may never achieve or maintain profitability."

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That's why I asked Money Morning Director of Tech & Venture Capital Research Michael A. Robinson how to play Snapchat stock on the Snapchat IPO date.

Here's what he said...

How to Play Snapchat Stock

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Robinson wanted to make sure I warned our readers about the risks of investing in IPOs.

"I generally tell retail investors to avoid buying an IPO at the open because the insiders have already made all the money available at the debut," Robinson told me.

You see, retail investors can't buy shares of Snapchat stock at the same price as large institutions and big banks. For example, insiders were able to buy shares of tech company Twilio Inc. (NYSE: TWLO) for $15 per share before the TWLO IPO on June 23, 2016.

When retail investors were finally able to buy shares of TWLO stock, they had to pay $23.99 per share.

That means in a matter of minutes, those wealthy insiders made a return of nearly 60%.

But regular retail investors haven't profited as much. In fact, some retail investors may have lost over half of their investment...

The TWLO stock price has had volatile price swings in the last 52 weeks, trading between $23.66 per share and $70.96 per share.

If investors bought TWLO stock while it was trading at its 52-week high of $70.96 on Sept. 28, those shares have dropped over 53% from today's opening price of $32.90.

Meanwhile, those wealthy insiders have now netted profits of 119.33%.

That's why Robinson has a strategy for playing Snapchat stock to help our readers maximize their profits and minimize their losses.

"My exception to this rule is to put in a limit order that is fairly tight from the offering price. Otherwise the risk is you buy at the top and then go upside down. That's a big risk to carry with a new issue that hasn't hit the lock-up date," Robinson said.

We know that our readers have a lot of questions about Snapchat stock. That's why we developed this free Snapchat stock guide.

In it, you'll learn how Snapchat works and how Snapchat makes money.

You can find the guide, right here.

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