Mitch Rubin’s RiverPark Advisors Portfolio: Top 5 Stock Picks

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In this article, we discuss the top 5 stock picks of Mitch Rubin’s RiverPark Advisors. If you want to skip our detailed analysis of these stocks, go directly to Mitch Rubin’s RiverPark Advisors Portfolio: Top 10 Stock Picks.

5. Snap Inc. (NYSE:SNAP)

RiverPark Advisors’ Stake Value: $25,691,000

Percentage of RiverPark Advisors’ 13F Portfolio: 3.27%

Number of Hedge Fund Holders: 64

Snap Inc. (NYSE:SNAP) is a California-based social media and camera company, founded in 2011. The flagship products of Snap Inc. (NYSE:SNAP) include Snapchat, Spectacles, and Bitmoji. As of Q3 2021, Snapchat has a daily worldwide user traffic of 306 million. RiverPark Advisors holds 377,028 shares in Snap Inc. (NYSE:SNAP) as of June this year, valued at $25.6 million, representing 3.27% of the firm’s investment portfolio. 

As of the second quarter of 2021, 64 funds from the elite database of 873 hedge funds maintained by Insider Monkey were long Snap Inc. (NYSE:SNAP), down from 73 in the preceding quarter. 

On October 21, Snap Inc. (NYSE:SNAP) posted a Q3 EPS of $0.17, beating estimates by $0.09. Revenue for the quarter totaled $1.07 billion, missing estimates by -$31.97 million. Citi analyst, Jason Bazinet, on November 1, upgraded Snap Inc. (NYSE:SNAP) from Sell to Neutral, following the Q3 results, with a price target of $53, down from $67. 

Here is what RiverPark Funds has to say about Snap Inc. (NYSE:SNAP) in its Q2 2021 investor letter:

“Snap shares were a top contributor for the quarter as well, also driven by strong first quarter results. The company reported accelerating revenue growth of 66% for the period (up from 62% fourth quarter growth), driven by user growth of 22%, and a 36% expansion in average revenue per user (ARPU). The company also guided to stronger-than-expected and accelerating 81%-85% revenue growth for second quarter 2021. Adjusted EBITDA improved by $79 million year over year for a break-even margin, up 1,800 basis points, and free cash flow improved dramatically, turning positive for the period to $126 million. Snap also continued to roll-out products that should help drive further expansion in user growth and ARPU, including Spotlight, a TikTok-like experience, with more than 125 million Snapchatters using it during March, and original programming starring Ryan Reynolds.

With TTM of $2.8 billion in revenue and an ARPU that is about 1/2 that of Twitter and 1/3 that of Facebook, we believe Snap has a long runway for both revenue growth and expanded profitability as it improves its platform functionality, grows its audience, and continues to advance its monetization.”

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