In this article, we discuss the 5 best social commerce stocks to buy. If you want our detailed analysis of these stocks, go directly to the 10 Best Social Commerce Stocks To Buy.
5. Snap Inc. (NYSE:SNAP)
Number of Hedge Fund Holders: 78
Snap Inc. (NYSE:SNAP) is a social media company that owns and operates platforms like Snapchat, Spectacles, and Bitmoji. Snap Inc. (NYSE:SNAP)’s main offering is Snapchat, which is a photo sharing and instant messaging platform. Following Facebook’s huge social shopping success, Snap Inc. (NYSE:SNAP) invested heavily in Snapchat’s social commerce features.
Snapchat leverages augmented reality technology, which allows users to virtually try on accessories and clothing, thus minimizing returns on online shopping orders. The users can also take a picture of a product with the Snapchat app, and find similar products to purchase online. Many brands also advertise their products via Snapchat influencers, who link their stories to the product website for purchasing.
Loop Capital analyst Alan Gould on December 21 lowered the price target on Snap Inc. (NYSE:SNAP) to $68 from $79 but kept a Buy rating on the shares.
Of the 78 hedge funds that were bullish on Snap Inc. (NYSE:SNAP) in the third quarter, Stephen Mandel’s Lone Pine Capital is the biggest company stakeholder, holding a $1.67 billion stake.
Here is what Jefferies Group has to say about Snap Inc. (NYSE:SNAP) in its Q3 2021 investor letter:
“We believe SNAP may be one of the best positioned virtual platforms in the development of the Metaverse. In order to better understand SNAP’s leadership position, we examine the significance of four key product areas; 1) the camera and augmented reality, 2) virtual avatars, 3) the Snap Map, and 4) hardware.
Camera and Augmented Reality: SNAP distinguishes itself from its peers by building products that leverage camera and AR technology as the principal drivers of engagement and user generated content. Currently, SNAP has 290M+ DAUs who create on average 5B snaps per day, open the app on average 30 times per day, and regularly use AR lenses to communicate with friends and brands (200M+ DAUs using AR). As we mentioned in the “Virtual Platforms” section of this report, the Metaverse is enabled by platforms that provide the “picks and shovels for content creation, the ongoing maintenance of live experiences, user interface, and social interactions”. We believe SNAP is beginning to successfully democratize its AR tool sets through its recently launched Lens Studio and Camera Kit. We highlight that the Lens Studio enables a community of 200K+ creators to build their own AR experiences using their own machine learning models. The Camera Kit makes the tools from the Lens Studio interoperable with partner apps like Zoom, the MLB, and Disney. In our view, SNAP is one of few platforms making AR technology easily accessible both inside and outside its App, which should support the company’s AR leadership for years to come…” (Click here to see the full text)
