Snap Stock Plunged After Earnings. Buy the Dip?

(NYSE: SNAP), the parent company of social media platform Snapchat, took a hard hit following its second‑quarter earnings release earlier this month. Shares tumbled, driven by worries about slowing growth, execution missteps, and a worsening net loss. But dig deeper, and the underlying narrative is more nuanced; there were a lot of positives in the report, too.

Revenue and users continue to grow at a robust rate, free cash flow has turned positive year over year, and new ad formats, such as sponsored Snaps, are demonstrating real engagement traction. Given the mix of good and bad in its underlying business and the stock's recent sell-off, it makes sense to check whether the shares have been pushed into oversold territory.

Let's look at what changed in the business and what it might mean for investors today.

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Source Fool.com