Facebook could make a bid for Snapchat's parent at the right price, one Wall Street analyst said on Thursday.
FBN Securities initiated coverage on Snap Thursday, and analyst Shebly Seyrafi said Facebook would love to buy the company for at least $20 billion or $14 a share.
"Remember that (Facebook) paid $21.8 (billion) for WhatsApp, a company which, although it had more users than SNAP, was not generating any real revenue," FBN's Seyrafi said in a note, giving Snap a "sector perform" rating and price target of $23.
Seyrafi said Facebook already tried to acquire Snap for $3 billion in 2013, and the company has the balance sheet and cash flow to finance the deal.
Seyrafi also commented on Snap's strong presence in 12-24 year age demographic, and said Snap has been "highly innovative so far."
Snap has had mixed reactions from Wall Street and has yet to receive a "buy" rating from any analyst listed in FactSet.