By Senad Karaahmetovic

Michael Nathanson, a MoffettNathanson analyst has revised his bullish outlooks for the long term after Snap released a revenue warning about Q2 earlier in the week.

Nathanson reduced Q2 revenues for Snap (NYSE), Meta, and Twitter by roughly -6% and -7% respectively. Alphabet (NASDAQ), however, saw a -22% drop.

“After years of uber-bullishness, we are truly concerned about longer-term growth in digital advertising. As such, we have severely cut our out-year revenue forecasts for all these companies,” Nathanson said in a client note.

“We are very concerned that the 2021 base of advertising was underpinned by both unsustainable corporate profitability and explosion in SME/e-commerce activity, which is now succumbing to a combination of factors. Therefore, our long-term forecasts of online ad growth for 2021-2025 are being reduced from an 18.5% annual CAGR to 12.5%. Note that these cuts do not contemplate the economic impact of a U.S. recession in the near term.”

Finally, the analyst expects that consensus estimates will have to be “massively lowered” to reflect slowing growth.

Snap price target reduced to $23.00 (from $44.00), FB to $280.00 ($330.00), Alphabet down to $2650.00 ($3,100.00), and FB to $280.00 ($330.00).