>>> Cobham receives approaches for assets; has talked to Moog about asset swaps

Cobham receives approaches for assets; has talked to Moog about asset swaps
03 MAR 2017
Cobham [LON:COB] Chief Executive David Lockwood said the FTSE-250 defence group has been approached by potential buyers for certain assets or for asset swaps, the Financial Times reported. Lockwood added that Cobham has already talked to Buffalo, New York-based counterpart MoogInc. about possible exchanges, the item said.
Lockwood was quoted in a report about Cobham’s proposed GBP 500m (EUR 582m) rights issue, which was announced on Thursday, 2 March.
The CEO was also quoted at the end of a Daily Telegraph report as saying that Cobham might consider asset disposals.
Cobham’s market capitalisation stood at GBP 2.36bn at the close of trading in London on Thursday.

>>> ML Pre-Market Indications

ML
* EUROPRIS - NC Europris selling $230m / 54.6m shares; DNB/Carnegie bookrunners
GEMALTO - Small beat & FY17 PFO guide inline with cons. Short int: 10% (59).+3%
SWISS LIFE - V strong with headline c2% beat & fees +12% beat v BAML (327)+1-2%
ENGIE - We UPGRADE to Buy, has finally reached an inflection point (12.7)...+1%
RYANAIR - Feb traffic +10% vol growth YoY and load factor +2% YoY (14.5)....+1%
SYNGENTA - FT reports deal is heading towards EU antitrust approval (442)...+1%
EDP - Inline nos after the close. FY16 net EU961 vs cons at EU934.5 (2.9)...u/c
MINERS - Copper +0.18%, Iron Ore fut +1.6%; BHP OZ -1.4%, RIO OZ -4.1%....-1-2%
WPP - Org growth inline, EPS 1-2% beat v cons but guidance is poor (1855)...-3%
CGG - Weak. EBITDA US$100m v US$135m cons. CFs to be worse in '17 (8.02)...-10%
BERENDSEN - Another warning. Guide fy17 ebit of c £150m vs cons £169m (836)-10%

>>> What to look at today - 3rd of Marche 2017

Dow -0.53% S&P -0.59% Nasdaq -0.73% Russell -1.27%
US Market closed lower after few records. financial sector (-1.4%), which led all S&P 500 sectors on Wednesday, took the biggest hit on Thursday, giving back over half of Wednesday's impressive 2.8% gain.  In light of the sector's huge 24.1% post-election advance, however, today's downtick was still relatively modest. The materials (-1.1%) and industrials (-1.0%) sectors also had a rough showing. Energy sector (-0.9%) also failed to keep pace with the benchmark index as crude oil prices slid 2.3%. The energy component finished Thursday at $52.61/bbl following reports that Russia failed to meet its pledged production cuts in the month of February. The consumer discretionary sector (-0.2%) also closed in negative territory, but just barely, as the earnings front provided the sector with a solid backstop. The fed funds futures market is now assigning an implied probability of 79.7% to a March rate hike, up from 66.4% yesterday and from only 26.6% last Friday. Snap launched its much anticipated IPO on Thursday. Snap IPO prices @ $17 traded up to $26.05 to close at $24.48 +44% - 216mil shares traded vs 200mil shares placed. US After Hours HABT +10.5%, MRVL +2% following earnings/guidance.... IMMR -17%, NTNX -14%, BBG -9%, COST -4% lower following earnings/guidance, SCYX -28.7% on clinical trial delay. Asia indices are down heading into the weekend, tracking far more restrained sentiment on Wall St after an outsized rally in the wake of Pres Trump's Congressional address. Concerns over valuations, building expectations of March Fed hike, and political controversy in the White House are being attributed for the decline, as Financials and Materials sold off the most heavily while Utilities rallied. Japan CPI data were mixed, as headline nationwide print ticked up higher while forward looking Tokyo-region dipped deeper in the red. In its regular QE operations, BOJ also pulled back on the purchases of long bonds in an effort to steepen the curve. In China, Feb Caixin Services PMI slowed to a 4-month low, even as overall Composite improved and composite Employment component rose for the first time in nearly 2 years.

Nikkei -0.49% Hang Seng -0.69% CSI -0.36% Shanghai -0.49%

Eur$ 1.0523 CNH 6.8943 CNY 6.8984 JPY 114.14 GBP 1.2264 JPY 1.0121 RUB 58.8912

S&P -0.24% EuroStoxx -0.27% Dax -0.35% FTSE -0.26% SMI -0.30%

Macro :
- ECB’s Lautenschlaeger Says She Doesn’t Want a Basel 4 for Banks
- U.S. Utility Index Hits 7-Month High On Switch to Safe Assets
- UBS Ponders S&P 500 at 2,500 as Strategists’ Forecast Rise
- Japan’s GPIF Posts Record $92b Gain in Oct.-Dec. Quarter

Keep an eye on :
- AIR FP : Airbus CEO Enders Wrote to Governments Over Cash: Echos
- AI FP : Air Liquide in Talks W/ Lincoln Electric on Sale of Welding Unit
- ANDR AV : Andritz Boosts Dividend After 2016 Ebitda Hits Record EU442.1m
- AAPL US : Apple’s Cue Said to Have Met With Paramount, Sony Units: NYP
- ASMI NA : ASM International Forecasts 1H Sales Growth After 4Q Net Jumps
- ATC NA : *ALTICE USA BUYS AUDIENCE PARTNERS; NO TERMS
- AAPL US : Apple Falls to Session Low; Digitimes Reports Fingerprint Issue
- BMW GY : BMW Recalls About 34,500 Cars in Japan for Air Bag Inflators
- CBK GY : Commerzbank Said to Have Abandoned Attempt to Buy OLB: FAZ
- CGD FP : Cegid Group FY Net Jumps 25%, Revenue Increases 9%
- CGG FP : CGG 4Q Net Loss $280m; Co. to Seek Debt to Equity Conversion
- DBK GY : Deutsche Bank Said to Seek New London HQ in Docklands: CoStar
- DBK GY : Deutsche Bank Reviewing Revamp of IT Management: Sueddeutsche
- EDP PL : EDP Full-Year 2016 Net EU961m; Est. EU934.5m
- EDP PL : EDP CEO Says There Is No Operation to Sell Naturgas at Moment
- ENEA SS : Enea Says Price for Engie Polish Assets Is Set at 1.26b Zloty
- FNTN GY : Freenet 2016 Ebitda EU438.8m, Est. EU412.8m
- GTO NA : Gemalto FY Rev. Beats Est.
- GEO IM : Geox 2016 Rev EU900.8m, Proposes Annual Div of EU0.02/Share
- GSK LN : GSK Shareholders Said to Demand CEO Pay Package Cut: Sky
- HOT GY : Hochtief: No Plans to Join Construction of U.S.-Mexico Wall
- ILD FP : Free Gets EU200m European Investment Bank Loan for Fiber: Echos
- I US : Intelsat Shares Fall 24% on Concerns Bondholders May Block Deal
- ITM IM : Italmobiliare to Seek Buyback Approval of Up to EU100m in Shares
- DEC FP : JCDecaux Interested in Clear Channel at Right Price: Reuters
- BAER VX : Julius Baer CEO Says Fed Rate Hikes Build Investor Confidence
- MS US : Morgan Stanley Said to Get Nearly $26m Fees From Snap IPO: WSJ
- KN FP : Natixis Names Prevedello, Rolandino Heads of Italy Coverage, M&A
- UG FP : PSA Said to Be Closing In on Deal to Buy GM’s European Opel Unit
- PSG SM : Prosegur Cash IPO to Raise Up to EU969m at EU1.95-EU2.35 Per Shr
- SNAP US : Snap Qualifies for Early Inclusion in Some MSCI Indexes
- LOCAL FP : Solocal Raises EU398m Cash From Shareholders, Creditors: Echos
- BID US : Sotheby’s Rallies as Much As 4% After Record London Auction
- SYNN VX : Syngenta Didn’t Get EU Statement of Objections on ChemChina: FT
- SPOTIFY IPO : Spotify Says It Has Reached 50m Subscribers
- UCG IM : UniCredit Says Rights Issue Fully Subscribed
- ZURN VX : Zurich CEO Mario Greco Receives Total Remuneration of CHF7.8m

>>> Europe : Brokers Upgrades & Downgrades - 3rd of MArch 2017

>>> Up
*AUTONEUM Raised to Buy at Kepler Cheuvreux, PT CHF315
*BAE Raised to Add at AlphaValue
*BBVA Raised to Outperform at MedioBanca, PT EU7
*Credit Suisse Raised to Neutral at MedioBanca, PT CHF14.50
*Danske Bank Raised to Neutral at MedioBanca, PT DKK256
*Elisa Raised to Outperform at Exane, PT EU37
*Evonik Raised to Neutral at Credit Suisse
*Hunting Raised to Equal-Weight at Morgan Stanley, PT 550p
*Iliad Raised to Outperform at Exane, PT EU240
*JCDecaux Raised to Equal-Weight at Barclays, PT EU31.50
*Kone Raised to Hold at Liberum, PT EU39
*KPN Raised to Outperform at Exane, PT EU3.20
*Lundin Petroleum Raised to Hold at Deutsche Bank, PT SEK188
*Nordea Raised to Neutral at MedioBanca, PT SEK114
*Sabadell Raised to Neutral at MedioBanca, PT EU1.55
*SAP Raised to Buy at SocGen
*Saras Raised to Add at AlphaValue
*SEB Raised to Outperform at MedioBanca, PT SEK120
*WH Smith Raised to Overweight at Barclays, PT GBP19.90

>>> Down
*Bpost Cut to Neutral at JPMorgan, PT EU24.50
*Hays Cut to Hold at Panmure Gordon & Co, PT 170p
*Kloeckner Cut to Neutral at Goldman
*Orange Cut to Neutral at Exane, PT EU15
*Panalpina Cut to Sell at Stifel, PT CHF105
*Roche Cut to Neutral at Main First Bank AG, PT CHF285
*Saras Cut to Neutral at Credit Suisse
*Subsea 7 Cut to Neutral at SpareBank, PT NOK126
*Swedbank Cut to Underperform at MedioBanca, PT SEK255
*TDC Cut to Neutral at Exane, PT DKK38
*Vastned Retail Cut to Reduce at HSBC, PT EU31

>>> Initiation
*Salvatore Ferragamo Rated New Outperform at Bernstein, PT EU32
*Tom Tailor Rated New Buy at Berenberg, PT EU12
*UniCredit Reinstated Neutral at Exane, PT EU13.60
*UniCredit Reinstated Outperform at MedioBanca, PT EU19.40

>>> Asian Update

Asia Mid-Session Market Update: China Services PMI prints 4-month low; Hong Kong PMI contraction deepens

***US Session Highlights***
- (RU) Russia Energy Min Novak: too soon to say if a global deal on oil output cuts will be extended
- (US) INITIAL JOBLESS CLAIMS: 223K V 245KE (lowest since Mar 1973); CONTINUING CLAIMS: 2.07M V 2.06ME
- (US) CNBC's Harwood: Treasury Sec Mnuchin said to have told Senate Banking Republicans that he opposes border adjustment tax
- (US) Feb ISM New York: 51.3 v 57.7 prior
- (US) WEEKLY EIA NATURAL GAS INVENTORIES: +7 BCF VS. -3 TO -5 BCF EXPECTED RANGE
- (US) Fed's Powell (moderate, voter): Rate hike in March is on table for discussion

- ***US markets on close: Dow -0.5%, S&P500 -0.6%, Nasdaq -0.7%***
- Best Sector in S&P500: Utilities
- Worst Sector in S&P500: Financials
- Biggest gainers: MNST +12.8%, BBY +6.4%, URBN +5.7%, GPS +3.3%, AES +2.5%
- Biggest losers: FCX -4.9%, KR -4.3%, CAT -4.3%, ENDP -4.1%, MUR -3.9%
- At the close: VIX 11.8 (-0.7pts); Treasuries: 2-yr 1.31% (+2bps), 10-yr 2.49% (+3bp), 30-yr 3.08% (+1bps)

***US movers afterhours***
- HABT: Reports Q4 $0.07 v $0.04e, R$73.9M v $73.3Me; Guides initial FY17 R$338-342M v $338Me; SSS +2%; Capex $44-47M; +10.9% afterhours
- GWRE: Reports Q2 $0.28 v $0.14e, R$115.6M v $110Me; Guides Q3 -$0.05 to -$0.02 v +$0.09e, R$102-106M v $111Me; +2.4% afterhours
- MRVL: Reports Q4 $0.22 v $0.19e, R$571M v $571Me; +2.0% afterhours
- ADSK: Reports Q4 -$0.28 v -$0.33e, R$479M v $473Me; -1.4% afterhours
- COST: Reports Q2 $1.17 v $1.35e, R$29.1B v $30.0Be; To increase membership fees by $5; -4.3% afterhours
- WING: Reports Q4 $0.15 v $0.14e, R$24.8M v $24.9Me; -6.8% afterhours
- AOBC: Reports Q3 $0.66 v $0.54e, R$233.5M v $234Me; Guides Q4 adj EPS $0.32-0.42 v $0.56e, R$200-220M v $242Me; -7.0% afterhours
- BBG: Reports Q4 -$0.18 adj v -$0.12e, R$51.6M v $63.6Me- Guides initial FY17 production 6.0-6.5 MMboe; Guides initial FY17 capex $255-285M; -10.3% afterhours
- NTNX: Reports Q2 -$0.28 v -$0.35e, R$182.2M v $179Me; Guides Q3 -$0.48 to -$0.45 v -$0.34e, R$180-190M v $187Me, gross margin 57-58%; -13.8% afterhours
- KPTI: Interim Analysis of Phase 2 SOPRA study evaluating Selinexor in Relapsed/Refractory Acute Myeloid Leukemia determines SOPRA will not reach statistical significance for overall survival (OS); -15.1% afterhours
- SCYX: Delays initiation of new clinical studies using the IV formulation of SCY-078 at FDA’s request; Ongoing and future clinical development using the oral formulation of SCY-078 are unaffected; -26.6% afterhours

***Politics***
- (US) President Trump: has 'total confidence' in Attorney General Sessions - press
- (US) Attorney General Sessions: To recuse himself from any investigations related to the Trump campaign
- (US) AG Sessions: Talked with US ambassador about a number of issues, including Ukraine; Did not discuss Trump campaign - Fox interview

***Asia Key economic data:***
- (CN) CHINA FEB CAIXIN PMI SERVICES: 52.6 V 53.1 PRIOR; 4-month low
- (JP) JAPAN FEB SERVICES PMI: 51.3 V 51.9 PRIOR; COMPOSITE PMI: 52.2 v 52.3 PRIOR
- (JP) JAPAN FEB TOKYO CPI Y/Y: -0.3% V -0.1%E; CPI EX-FRESH FOOD Y/Y: -0.3% V -0.2%E
- (JP) JAPAN JAN NATIONAL CPI Y/Y: 0.4% V 0.4%E; CPI EX FRESH FOOD (CORE) Y/Y: 0.1% V 0.0%E
- (JP) JAPAN JAN JOBLESS RATE: 3.0% V 3.0%E
- (JP) JAPAN JAN OVERALL HOUSEHOLD SPENDING Y/Y: -1.2% V -0.4%E
- (HK) HONG KONG FEB COMPOSITE PMI:49.6 V 49.9 PRIOR; 2nd month of contraction
- (SG) SINGAPORE FEB PMI COMPOSITE: 51.4 V 51.6 PRIOR
- (KR) SOUTH KOREA FEB CPI M/M: 0.3% V 0.1%E; Y/Y: 1.9% V 1.8%E
- (KR) SOUTH KOREA FEB CURRENT ACCOUNT BALANCE: $5.3B V $7.9B PRIOR; GOODS BALANCE: $7.8B V $9.4B PRIOR

***Asia Session Notable Observations, Speakers and Press***
- Asia indices are down heading into the weekend, tracking far more restrained sentiment on Wall St after an outsized rally in the wake of Pres Trump's Congressional address. Concerns over valuations, building expectations of March Fed hike, and political controversy in the White House are being attributed for the decline, as Financials and Materials sold off the most heavily while Utilities rallied. Regionally, ASX200 was pulled lower by mining shares, with Dalian Iron Ore down notably and HSBC warning of potential "massive fall" in the metal. In FX space, USD/JPY and NZD/USD saw more pronounced declines on risk aversion, falling 40 and 35 pips from session highs respectively.
- Japan CPI data were mixed, as headline nationwide print ticked up higher while forward looking Tokyo-region dipped deeper in the red. In its regular QE operations, BOJ also pulled back on the purchases of long bonds in an effort to steepen the curve.
- In China, Feb Caixin Services PMI slowed to a 4-month low, even as overall Composite improved and composite Employment component rose for the first time in nearly 2 years. Economists noted a rise in new orders along with a sharp rise in input costs in Feb, while the Outlook anticipates growth momentum in Q1 before some slowing in Q2. Hong Kong PMI saw its 2nd straight month of contraction amid receding inflation, biggest contraction in new orders in a year, and rising inventories. Note that China's annual National People’s Congress (NPC) begins on Sunday with anticipated announcement of 2017 economic targets.

China
- (CN) Hangzhou City to further restrict housing purchase to curb property market - Xinhua
- (CN) China govt urged to offer a preferential rate to small home buyers - Chinese press
- (CN) PwC annual CEO survey: 33% of mainland China execs are "very confident" about their 12-month outlook for op income v 25% y/y - Chinese press

Japan
- (JP) Japan Fin Min Aso: to determine contents of US-Japan economic dialogue
- (JP) Japan Defense Ministry scrambled its fighter jets after about 13 China airplanes were seen flying through Miyako Strait between Japan's southern islands of Okinawa and Miyako - Nikkei

Australia
- HSBC: Iron ore prices are set for a "massive fall" - SMH
- (AU) OECD: Australia housing market could "develop into a rout" - Australian press

***Asian Equity Indices/Futures (00:00ET)***
- Nikkei -0.7%, Hang Seng -0.7%, Shanghai Composite -0.4%, ASX200 -0.8%, Kospi -1.3%
- Equity Futures: S&P500 -0.3%; Nasdaq -0.3%; Dax -0.3%; FTSE100 -0.3%

***FX ranges/Commodities/Fixed Income (00:00ET)***
- EUR 1.0500-1.0525; JPY 114.05-114.45; AUD 0.7545-0.7575; NZD 0.7030-0.7065
- Apr Gold +0.1% at $1,234/oz; Apr Crude Oil +0.1% at $52.67/brl; May Copper -0.1% at $2.68/lb
- GLD SPDR Gold Trust ETF daily holdings rise 1.8 tonnes to 845.3 tonnes; 2nd straight increase
- (CN) PBOC SETS YUAN MID POINT AT 6.8896 V 6.8809 PRIOR; 3rd straight weaker setting; weakest Yuan setting since Feb 13th
- (CN) PBOC to inject combined CNY30B v CNY30B prior in 7-day, 14-day and 28-day reverse repos
- (AU) Australia MoF (AOFM) sells A$800M in 1.75% 2020 Bonds; avg yield: 2.1076%; bid-to-cover: 5.16x
- (JP) BOJ To buy ¥100B in JGBs with maturity over 25-yr (down from ¥120B)

***Asia equities / Notables / movers by sector***
- Consumer discretionary: 9983.JP Fast Retailing +2.0% (Feb Uniqlo SSS); 2685.JP Adastria Holdings Co -1.8% (Feb SSS)
- Financials: 337.HK Greenland Hong Kong +3.4% (profit alert); BOQ.AU Bank of Queensland -3.1% (JPMorgan cuts rating); AFG.AU Allco Finance -2.0% (CEO steps down); MPL.AU Medibank -3.1% (Macquarie cuts rating)
- Industrials: 6104.JP Toshiba Machine Co +4.9%; 1802.JP Obayashi Corp -4.3% (Credit Suisse cuts rating)
- Technology: 300104.CN Leshi Internet Info & Tech Co Beijing -4.9% (easing short-term funding pressure, to exit India); 002465.CN Guangzhou Haige Communications Group Inc Co +2.9% (approval for new shares)
- Materials: WGX.AU Westgold Resources -1.2% (Bell Potter cuts rating); FMG.AU Fortescue Metals Group -5.4% (iron ore price may face massive fall)
- Energy: RIL.IN Reliance Industries +2.4% (Ruffer raises stake)
- Healthcare: 9627.JP Ain Pharmacie -1.6% (9-month result); 4694.JP BML -3.0%, 6849.JPNihon Kohden Corp -1.7% (Jefferies cuts rating)
- Telecom: NTC.AU Netcomm Wireless -6.0% (Canaccord Genuity Cuts rating)

>>> US After Hours Summary: HABT +10.5%, MRVL +2% following earnin

After Hours Summary: HABT +10.5%, MRVL +2% following earnings/guidance.... IMMR -17%, NTNX -14%, BBG -9%, COST -4% lower following earnings/guidance, SCYX -28.7% on clinical trial delay

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: HABT +10.5%, SYN +2.5%, GWRE +2.4%, MRVL +2.1%

Companies trading higher in after hours in reaction to news: PPHM +10.8% (indicated higher after Ronin Capital discloses 6.8% active stake; may also wish to engage in a dialogue with officers, directors, and other representatives), BIOS +6.8% (enters into a Stock Purchase Agreement for the sale of an aggregate of 3,300,000 shares of its common stock for aggregate gross proceeds of $5,070,780 in a private placement), VTTI +3.5% (ticking higher; VTTI Energy Partners receives a proposal from VTTI B.V. pursuant to which VTTI would acquire through a wholly owned subsidiary all publicly held common units of the Partnership in exchange for $18.75/unit)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: IMMR -16.7%, NTNX -14.2%, BBG -9.4%, RGLS -9.1% (light volume), WING -6.9%, AOBC -5.1%, AMRS -4.5%, COST -4.1%, (Costco also confirmed plans for membership fee increase), ADSK -1.3%

Companies trading lower in after hours in reaction to news: SCYX -28.7% (delays the initiation of any new clinical studies with the IV formulation of SCY-078 until the FDA completes a review of all available pre-clinical and clinical data of the IV formulation of SCY-078), KPTI -15.1% (announced the results of a planned interim analysis of the Phase 2 SOPRA study evaluating single agent selinexor in relapsed/refractory acute myeloid leukemia; study will not reach statistically significant improvement in primary endpoint of overall survival in patients who are unfit for chemotherapy and/or transplantation), ZSAN -12.7% (files for $46 mln common stock offering), HMSY -8.8% (files to delay its 10-K; is continuing to evaluate whether this issue affects its consolidated financial results, primarily focusing on prior periods in which revenue relating to the CMS business was recorded), RGR -1.6% (AOBC sympathy), BLDR -1.5% (commences a secondary offering of 10,000,000 shares of its common stock to be sold by JLL Building Holdings)

FT : Snapchat owner closes up 44% for $28.3bn valuation

Snapchat owner closes up 44% for $28.3bn valuation
Messaging app revives era of hot tech IPOs as investors shrug off governance concerns

The US broke its long drought of big technology initial public offerings on Thursday as shares in Snap soared 44 per cent in their market debut despite questions about corporate governance and profitability at the owner of vanishing messaging service Snapchat.

A pack of traders huddled around the desk of Snap’s designated market maker for more than an hour after the opening bell at the New York Stock Exchange to strike the opening price, when cheers rang out across the floor. The IPO was priced at $17 on Wednesday afternoon — raising $2.5bn for the company and $935m for selling shareholders — with the shares opening at $24.

The shares traded in a $23.50-$26.05 band during the day before ending the session at $24.48, valuing the group at $28.3bn.

That makes Snap worth about two and a half times social media rival Twitter, and about the same as food manufacturer Kellogg, video games maker Electronic Arts and electronics company Panasonic. But it is dwarfed by its two main rivals for advertising dollars: Google, at $580bn, and Facebook, at $395bn.

Some 75m Snap shares changed hands at 11.35am New York time, when it began trading, the highest volume of any stock worth more than $50m on US exchanges, according to data from Bloomberg.

The IPO is being touted as a barometer for investor demand for tech listings, coming in a particularly slow period. Last year was the worst for US tech listings since 2009 and Snap is the largest US-listed tech IPO since Alibaba in 2014 based on amount raised and market capitalisation.

The latest hot tech companies, which also include Uber and Airbnb, have been able to raise billions of dollars at high valuations privately, creating the herd of so-called unicorns, or tech companies that have achieved valuations of $1bn or more without going public.

The enthusiasm for Snap came despite the decision by some portfolio managers to shun the stock over concerns about the company’s decision to issue shares with no voting rights, a first in the US, and to ensure control for the co-founders even if they leave the company.

In addition, some analysts questioned whether an app with no profits and fierce competition from other social media groups warranted such a lofty valuation. Last year the company recorded a net loss of $515m, up from $373m in 2015, on revenue of $405m.

Brian Wieser, an analyst at Pivotal Research, said Snap was “significantly overvalued” because of the competitive environment it faces, a mostly unproven business model and the risks to shareholders that they will be diluted because of “aggressive” share issuance to employees.

Mr Wieser issued a “sell” rating on the stock and a price target of just $10.

Snap’s co-founders rang the bell at the NYSE as they awaited the first trades of the IPO that has made them billionaires. Evan Spiegel, the 26-year old chief executive, and Bobby Murphy, the chief technology officer, dressed in smart suits and ties, unlike previous tech entrepreneurs who have preferred casual wear such as hoodies and T-shirts. NYSE president Tom Farley was also on hand, standing on the podium beside them.

Mr Spiegel’s fiancé, model Miranda Kerr, joined him at the NYSE, among a Snap entourage of about 100 people including employees, board members and family.

Outside the stock exchange, a large yellow sign reading ‘Snap Inc’ hung above the entrance. Inside, screens featuring Snap’s signature ghost icon hung above the NYSE floor, while Snap and NYSE staff sported Spectacles, Snap’s video sunglasses.

A Snapbot, a yellow vending machine that dispenses Spectacles, also appeared at the NYSE as a gift from the company, with a bunch of yellow balloons flying on top.

Snap also gave out spectacles to traders at their designated market maker, GTS, but they chose not to wear them so that the glasses would not accidentally reveal the order books.

Founded as an alternative to existing social media platforms, Snap allows for quick-fire exchange of “snaps” that disappear after 10 seconds.

Snap has added features including 24-hour collections of photos called “stories” and a platform for publishers where users watch news and entertainment called “discover”. Snapchat is selling itself as a place mostly for close friends, rather than acquaintances that fill Facebook and strangers that dominate Twitter.

Some 158m people open the app an average of 18 times a day, with 60 per cent of them sending a snap to a friend every day and 25 per cent creating a story. The largest age group is 18 to 24, a generation that advertisers are hoping to reach on mobile now that they do not spend much time watching TV.

Pre-IPO investors who will benefit from the offering stretch from venture capitalists Benchmark and Lightspeed Venture Partners to large tech companies Alibaba and Yahoo, and include a Silicon Valley high school. Saint Francis High School in Mountain View invested $15,000 in Snap’s seed round, after kids at the school were the first to tell a venture capitalist about the app.

John Colley, a professor at Warwick Business School, noted that the company faces significant challenges in competing with Facebook and Google, generates substantial losses and is suffering from slowing growth.

“Snap Inc is benefiting from institutions and individuals being awash with cash,” he said. “The top end valuation reflects high liquidity rather than a great prospect. There is far more cash than opportunities, which means pursuit of long odds risky options such as Snapchat.”