Jefferies Group: “SNAP Can Benefit in the Development of the Metaverse”

·3 min read

Jefferies Group, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. In the letter, the fund talked about the Metaverse and discussed some of the key companies involved in this virtual/augmented reality technology. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Jefferies Group, in its Q3 2021 investor letter, mentioned Snap Inc. (NYSE: SNAP) and discussed its stance on the firm. Snap Inc. is a Santa Monica, California-based camera and social media company with an $81.5 billion market capitalization. SNAP delivered a -0.82% return since the beginning of the year, while its 12-month returns are up by 9.00%. The stock closed at $49.66 per share on November 24, 2021.

Here is what Jefferies Group has to say about Snap Inc. 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)

Snapchat, Snap
Snapchat, Snap

Photo by Alexander Shatov on Unsplash

Based on our calculations, Snap Inc. (NYSE: SNAP) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. SNAP was in 78 hedge fund portfolios at the end of the third quarter of 2021, compared to 64 funds in the previous quarter. Snap Inc. (NYSE: SNAP) delivered a -33.51% return in the past 3 months.

Disclosure: None. This article is originally published at Insider Monkey.

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