Snap's stock price rose 1.65% to $16.02 in premarket trading after Susquehanna raised its rating of the social media company's stock to neutral from negative.
The report by Susquehanna analyst Shyam Patil cited progress Snap has made in advertising, with the prospect for further growth in the fourth quarter.
Susquehanna also sees more growth ahead for Snap's "stories" feature, which has been given a boost by Instagram's success in this area, with advertisers now more open to using this new feature in their marketing campaigns.
Best known for its Snapchat app, Snap has a real chance of meeting or even surpassing its goal of adding 2 million to 4 million new users in the fourth quarter, the report noted.
Shares of Snap have posted big gains over the past six months, rising by nearly 50% since March 18, when they were trading at $10.94 a share.
The real test, though, will come when Snap reports its third-quarter earnings on Oct. 24.
Snap is on track to report a loss of 5 cents a share, up 58.33% from the third quarter of 2018, according to analysts surveyed by Zacks Investment Research. Revenue is expected to hit $437.59 million, up nearly 47% from a year ago.