Snap Inc (NYSE:SNAP) shares are trading higher Tuesday morning after activist investor Irenic Capital Management publicly urged the company to take a series of aggressive steps to unlock shareholder value, including improving ad monetization with AI, cutting costs, increasing buybacks and strengthening corporate governance.
- Snap stock is surging to new heights today. What’s behind SNAP gains?
Irenic Says Snap Is Deeply Undervalued
Irenic, which said it has an economic interest in about 2.5% of Snap's Class A shares, argued the company could be worth at least $26.37 per share, far above its recent trading level near $3.93. The firm said Snap's large user base, growing subscription business, AI distribution potential and augmented reality assets are not being properly reflected in the stock.
Activist Push Targets AI, Costs And Buybacks
The investor also called on Snap to shut down or spin off its Specs business, rationalize headcount, improve stock-based compensation practices and redirect more resources toward higher-return AI and advertising tools. It further suggested that stronger profitability could support meaningful stock repurchases at what it sees as a heavily discounted valuation.
Snap stock may be rising because investors often respond positively when an activist investor outlines a credible path to higher margins, better capital allocation and potentially much greater equity value.
SNAP Shares Surge Tuesday Morning
SNAP Price Action: Snap shares were up 13.43% at $4.56 at the time of publication on Tuesday, according to Benzinga Pro data.
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