Snap Inc. (SNAP - Get Report) shares traded sharply higher Tuesday following a pair of analyst upgrades for the instant messaging app maker as it wins back faith from Wall Street amid improving revenues and longer user engagement. 

Aegis Capital boosted its price target on Snap by more than 50% to $17 a share, and upgraded its rating to "buy" from "hold", as it "walks back" a previous view that the group should seek a buyer for the business. Aegis analyst Victor Anthony increased his 2020/2021 revenue estimate by 5% and 10% respectively, citing improved results from the Android rebuild of the Snapchat app and a better advertising platform. BTIG's Richard Greenfield also upped his price target on Snap to $20 a share, marking the third separate analyst boost so far this month. 

"While we agree with investors that both Facebook & Twitter are in better fundamental shape "today" compared to Snap, given that both are profitable and generate free cash flow, Snap is emerging from its challenges with improving monetization, better user trends, and lower cash burn," Anthony said. "We were skeptical of Snap's ability to drive user growth, concerned that the ad platform was inferior to competitors in terms of targeting and analytics, and concerned that there was no clear path towards profitability and positive cash flow inflection. We walk back our previous assertion that Evan Spiegel should find a buyer for the business - Snap
can stand on its own."

Snap shares were marked 6% higher Tuesday to change hands at $14.34 each, a move that will extend the stock's year-to-date advance past 158%.

Snap said its first quarter loss came in at a narrower-than-expected 10 cents per share on an adjusted basis, while revenues rose 39% for a forecast-beating $320 million, a figure the company sees improving to as much as $360 million in the three months ending in June.

Daily active users on the group's key platform rose 2% from the previous quarter, thanks in part to the new Android development focus, to around 190 million thanks to renewed growth in international markets.