Snap Inc., the parent company of Snapchat, has experienced a remarkable surge in its stock performance, with shares surging nearly 30% in November. This represents the company's best month in over three years. Jefferies analyst, James Heaney, has offered an optimistic perspective on Snap's future, leading him to upgrade his rating on the stock from hold to buy.

Heaney highlights Snap's progress in developing its direct-response advertising platform, which has the potential to drive revenue growth moving into the next year. He believes that this platform will continue to enhance advertiser performance and fuel faster budget growth. The positive impact of these recent changes is already evident, with Snap's third-quarter year-over-year growth reaching its highest level since 2020, showing an 11% sequential growth.

Regarding the temporary setback experienced by large advertisers due to the reconstruction of the direct-response ad platform, Heaney asserts that this trend has already started to reverse. This reversal is anticipated to contribute to Snap's revenue growth at a mid-teens rate by 2024. Furthermore, Heaney notes that Snap's decision to enable on-platform checkout with Amazon indicates a deepening integration with large advertisers, aimed at encouraging more ad spend.

Considering these factors, Heaney has increased his price target on Snap's stock from $12 to $16. This bullish outlook suggests that Snap Inc. is well-positioned for continued success and growth in the future.

Heaney's Positive Outlooks Drive Snap's Stock

Snap Inc., the parent company of Snapchat, is experiencing a notable boost in its stock as analyst Jeffrey Heaney expresses optimism for the company's future. Heaney is particularly encouraged by Snap's positioning for the remainder of this year, acknowledging the cautious approach taken in their internal fourth-quarter outlook due to concerns about the impact of Middle East conflicts.

As of Thursday's premarket action, Snap shares have surged by almost 3%. Throughout November, they have gained an impressive 29.7%, on track to achieve their fourth-best monthly increase ever and their most remarkable monthly performance since the significant surge of 50.9% in October 2020.

Additionally, Heaney has upgraded his rating on shares of Pinterest Inc. (PINS) from hold to buy. His newfound confidence stems from the belief that there is a high possibility for over 20% revenue growth in 2024. Heaney and his team expect that ad pricing, which has been a major hindrance thus far, will transition from being a headwind to a tailwind in fiscal year 2024. This shift implies that impression growth would need to significantly decelerate for Pinterest to miss the expected mid-to-high teens revenue growth projected for next year. Consequently, Heaney has raised his price target for Pinterest shares from $32 to $41.

In response to these positive developments, Pinterest shares are also making headway, with an approximate 2% increase observed during premarket activity.

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