Snap shares jumped Thursday after investment firm PiperJaffray initiated coverage on the stock at "neutral" with a price target of $23.
Shares of Snapchat's parent company climbed 6 percent by market close Thursday to reach $23.13. The stock closed up more than 7 percent at $21.82 per share the day prior.
The firm said in a note to investors Wednesday it is staying sidelined until "Snap validates its ability to fend of copy cat competition."
"Namely ephemeral photo/video and Stories platforms at Instagram and Facebook Messenger," PiperJaffray senior research analyst Samuel Kemp said.
Shares of Snap have been on the move recently after it snagged its first "buy" rating from Wall Street. It had initially raised eyebrows on the Street, with analysts flagging its slowing user growth, widening losses and lack of voting rights for outside investors.