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Snap shares 'dramatically' overvalued — and there's more pressure ahead, analyst says

With a much weaker competitive edge than six months ago, there's about to be some serious pressure on shares of Snap's stock, an analyst told CNBC on Thursday.

"I think it's a risky and speculative stock, and the data is starting to bear that out," Nomura analyst Anthony DiClemente told "Power Lunch."

Snap, the maker of ephemeral messaging app Snapchat, saw shares fall about 3.5 percent on Thursday, amid DiClemente's bearish research note, and a Bloomberg report that Snap is the year's most-shorted tech IPO so far.

Snap's $3.4 billion March public offering was hotly anticipated, reawakening a struggling U.S. IPO market. Shares rose 44 percent on their first day of trading, with more than the entire 200 million-share offering changing hands within the first day.

But since then, rival Facebook has dulled Snap's competitive edge, DiClemente said, by releasing copycat products to its massive user base. And more change is afoot.

Snap co-founders Evan Spiegel (R) and Bobby Murphy walk to ring the opening bell of the New York Stock Exchange, March 2, 2017.
Lucas Jackson | Reuters
Snap co-founders Evan Spiegel (R) and Bobby Murphy walk to ring the opening bell of the New York Stock Exchange, March 2, 2017.

An additional 1.2 billion Snap shares, or 84 percent of the company's shares outstanding, could flood the market when the company's lock-up period expires from July 31 to August 31, according to JPMorgan, one of the IPO's underwriters. When that happened to Twitter, shares fell 18 percent to what was then an all-time low. Facebook, on the other hand, popped 11 percent when its lock-up period expired.

To be sure, DiClemente's research cites app download data, since it will be a while before Snap reports quarterly earnings again. DiClemente's $14 price target on the stock is well below the average of $21.03 a share listed in FactSet.

Still, DiClemente said he thinks the share price could well fall to the single digits.

"I think there's going to be pressure on the stock ahead and through the lockup," DiClemente said. "It's dramatically overvalued." Snap did not immediately respond to a request for comment.

— CNBC's Tae Kim contributed to this report.

Disclosure: CNBC parent NBCUniversal invested $500 million in Snap's IPO.