Bullish thesis on Snap arguing new glasses launch, storage monetization, and cost discipline could drive cash-flow positivity and re-rating.
SNAP — LONG The author argues Snap is undervalued because the release of Snapchat glasses this year could end cash burn, turning the company cash-flow positive and prompting a market re-rating. If the glasses fail and are scrapped, the author claims roughly $1B in annual R&D savings, slower dilution, and more buybacks would also help the stock. Additional support cited includes growing Snapchat+ revenue of $700M/year and new storage charges that either generate revenue or cut storage costs. The main stated risk is that the glasses fail.
If the glasses fail and he scraps them, Snapchat saves roughly $1B a year in R&D, turns cash-flow positive, slows dilution, buys back more stock, and the market probably re-rates the company.