Traders are cranking up their bets against Snap
Traders haven't been this bearish on Snap since the period immediately following its initial public offering.
The ratio of bearish put contracts on Snap's stock to bullish calls is 1.7-to-1, the highest since March 17, only the fifth day that Snap options were available to be traded.
After an initial shorting frenzy that pushed the ratio as high as 3-to-1, bearishness leveled off for a couple of months. But now that Snap has been drawing the ire of analysts across Wall Street because of concerns over user growth, pessimism is once again mounting.
The most recent criticism came from Nomura on Wednesday. Looking at data around downloads on the Snapchat app, analyst Anthony DiClemente highlighted slowing daily-average user growth through the first two months of the second quarter.
DiClemente doesn't expect near-term monetization growth to pick back up, and he also noted an acceleration in downloads for Instagram. He warned against competitor growth at a time when Snap's user expansion is slowing.
JPMorgan got in on the action on Monday, lowering its price target on the company. The firm also has concerns over fewer people flocking to the platform than expected. It estimated that only 8 million users will join Snapchat in the second quarter of 2017, missing the previous forecast of 10 million.
Of all the underwriters that participated in Snap's IPO, none have been more downbeat than JPMorgan, which received the third-biggest share of stock to sell in the offering. The firm lowered its price target on the stock after a disappointing first-quarter earnings report last month.
Business Insider / Andy Kiersz, data from Bloomberg
Get the latest Snap stock price here.
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