Shares of social media company Snap plummeted by as much as 20 percent Wednesday following disappointing earnings, and Wall Street still sees room on the downside.
The company significantly missed revenue estimates in its latest report and said its next quarter year-over-year revenue growth rate will "decelerate substantially," partially due to ad prices. The company also missed analysts target for daily active users and revenue per user.
As a result, multiple firms published bearish notes and knocked down their price targets for Snap's stock.
Morgan Stanley dropped its price target to $8, about $6 below where the stock closed Tuesday, and remains underweight. Snap was trading at $11.45 on Wednesday morning, down nearly 19 percent on the day.
"1Q:18 miss and forward ad commentary speak to continued challenges SNAP faces in turning its business model around," Morgan Stanley analyst Brian Nowak said in a note to clients Wednesday.