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Snap's (SNAP) New Parental Controls to Protect Teen Users

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Snap (SNAP - Free Report) recently announced new parental controls in Snapchat to limit friend suggestions for teen users and protect them from unwanted attention.

Snapchat has added a new safeguard to Quick Add — the friend suggestion feature of Snapchat — to protect 13 to 17-year-olds from being discovered by strangers. In order to discover under 18s in Quick Add, adult strangers will need to have a certain number of friends in common, which will ensure they know them in real life.

Snap has been enhancing its artificial intelligence (AI) to detect and block drug-related slang from being visible to users in Snapchat. The company, in collaboration with law enforcement agencies, has been trying to improve its response time to law enforcement requests.

Snap Inc. Price and Consensus

Snap Inc. Price and Consensus

Snap Inc. price-consensus-chart | Snap Inc. Quote

Snap Grapples With Fentanyl Epidemic: An Impediment to User Growth

Snapchat’s recent initiatives come following allegations that the company has been failing to prevent drug-related content in its chatting platforms specifically among its users aged below 18.

This is a matter of major concern for Snap as its chatting platform Snapchat is used mostly by Gen Z, who are extremely vulnerable to drug-related content and individuals circulating them in the platform.

The fentanyl epidemic is a national crisis in the United States as several people have recently died from opioid overdoses. Synthetic opioids such as fentanyl, heroin and prescribed pain killers are being misused by U.S. citizens resulting in overdoses, which often lead to death.

Snapchat has been the most preferred social network among Gen Z, owing to the immersive experience offered by the platform. Snapchat reaches 75% of 13-34-year olds in the United States, making it a bigger platform than Meta Platform’s (FB - Free Report) Facebook and Instagram and Twitter (TWTR - Free Report) among this demography.

Snap is making sincere efforts to protect underage users from adult strangers, thus reducing the chances of a conversation regarding drug usage. The company is advancing its AI to detect conversations and slang related to drugs.

Failure to comply with the necessary requirements to protect users from drugs would result in the loss of existing users to closest rival Meta Platforms’ Facebook, which has mimicked Snapchat features on its platforms to bolster user growth.

Facebook has even been able to rival Snapchat’s unique platform and has been gaining popularity as a platform with a complete social media package from content sharing to chatting.

Twitter’s unique platform, even though it is different from Snapchat, has been gaining ground among users of all age groups due to its openness, real-time content, conversational format, and simplicity. It has also been able to maintain the security of users in its platform and thus boosts trustworthiness.

Zacks Rank and a Stock to Consider

Snap currently carries a Zacks Rank #4 (Sell).

Snap shares have tumbled 29.5% in the past year underperforming the Computer and Technology Industry.

The Zacks Consensus Estimate for its 2022 earnings has remained unchanged in the past 60 days at 35 Cents per share.

Apple (AAPL - Free Report) is a better-ranked stock in the same sector.

Apple sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Apple’s 2022 earnings has moved upward by 0.90% in the past 60 days to $5.82 per share.


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