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Snap Inc shares which tumbled last week due to its first sell rating from an analyst is now recovering by as much as 6% to $23.13 after a neutral rating from investment firm Piper Jaffray.

First “Sell” Rating

The social company which launched its shares for earlier this month was rated to be one of the top technology public offerings in the past three years next to Twitter and Alibaba’s launch last year received two “sell” ratings last week sending its shares down by as much as 4% to $19.92.

Analyst Michael Nathanson of MoffettNathanson have the Snap IPO a “sell” rating with a note than that market has priced SNAP for perfection.

Other Wall Street analysts have also largely taken note the weak user growth of the company’s application Snapchat which would lead more losses for the company. Last year Snap Inc reported losses to more than $500 million, higher than the previous year’s $300 million loss.

Snap also warned investors that its shares might not be as profitable in the first couple of quarters especially with the restructuring and expansion plans the company is currently going through.

Aside from Nathanson, six other analysts have also given Snap shares a sell rating with three other giving neutral ratings.

Snap Inc rallied by more than 40% during its initial public offering to $24 from its initial pricing at $17. Snap Inc initially priced their shares at around $14-$16. The stock then decline during the second day and brought investors on edge as it recorded its first all-time low of $20.62 and has traded down for the next three trading sessions.

Snap shares have declined by as much as 9.8% during the fourth trading session and was even predicted to sink by as low as $17 which was the stock’s IPO pricing.

‘Buy’ Rating Sends Snap Shares Up

Although the stock has sinked on its first couple of sell ratings, its first and second buy rating from Wall Street analysts sent its stock to recover by around 7%.

The first buy rating which came from James Cakmak of the Monness Crespi Hardt was followed by Drexel Hamilton’s Brian White giving the stock a target price of $30.

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According to Cakmak, Snap shares “can become the equivalent to channel surfing with high impact short -form content from premium publishers.” He also noted that this can be highly monetized by the company and that he found the value understated. Cakmak gave the stock a target price of $25, where shares were trading below the $20 price level at the time.

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