• by Joe Mandese  @mp_joemandese, June 6, 2019

Wall Street equities research firm Pivotal Research Group has upgraded its rating for shares of Snap to a “buy” from a “hold,” citing “increasing signs of momentum” from users and advertisers.

“User growth has prospectively turned the corner,” Pivotal Senior Research Analyst Michael Levine writes in a note sent to investors, adding that the recent launch of Snap’s Android version is going well, and that Snap’s overall product development “constitutes real innovation in augmented reality.”

In terms of the ad industry, Levine writes that Snap is “moving in the right direction,” adding the equities firm continues to “hear glowing things about the organization under Jeremi Gorman,” who joined Snap as Chief Business Officer in November from a senior ad sales role at Amazon.

“When there is a change in senior sales leadership, you have a three to four quarter window to make amends for mistakes/mis-execution under the prior regime,” Levine said, adding that Pivotal’s “checks” with the ad industry have found positive feedback from large brands and agencies, “but self-serve both domestic and internationally should be incremental as well.”

Perhaps most significantly in terms of Snap’s upside potential, Levine said its ad inventory currently is “underpenetrated on media plans.”

In addition to upgrading its stock rating, Pivotal also boosted its share price target to $17.25 from $13.25 previously.