Snapchat's stock price is diving on Wednesday, down 4.29% at $21.19 as of 1:22 p.m. ET.
Shares have rebounded since hitting a low of $18.90 on March 17, but are down 14% since reaching an all-time high of $28.84 on March 3.
On Tuesday, disgruntled former Snap employee, Anthony Pompliano, asked a judge to unseal the allegations he made against Snapchat in a January lawsuit.
Pompliano was poached from Facebook and fired by Snapchat three weeks later. Pompliano says that he found out that Snapchat was dishonest in its disclosure of metrics to investors and that the unsealing of court documents will reveal what he found to the public.
Business Insider's Alex Heath wrote:
In Pompliano's opposition on Tuesday to Snap, his lawyers argue that "Snap’s outsized valuation is built on a house of cards" that has been "systematically built through a coordinated effort from Snap’s executives to personally reward themselves with billions of dollars by maliciously manipulating metrics, suppressing metrics that put the company in a negative light, and even, at times, blatantly misleading professional investors, employees, advertisers, and now, retail investors."
Last week, Snapchat received a slew of outperform and buy ratings from Wall Street analysts, which boosted the stock price. However, that excitement was struck down when Facebook announced the release of software to compete with Snapchat.
Here are the ratings from the article written by, Akin Oyedele.
- Goldman Sachs: Buy, $27 price target
- Morgan Stanley: Overweight, $28 price target
- Citi: Buy, $27 price target
- RBC: Outperform, $31 price target
- Jefferies: Buy, $30 price target
- Oppenheimer: Market perform
- Credit Suisse: Outperform, $30 price target
- UBS: Neutral, $24 price target
- Stifel: Hold, $24 price target
- Cowen: Outperform, $26 price target
Click here for a real-time Snap inc. chart.