Two beaten-down internet stocks could be in for an extended struggle with the digital advertising market in flux, according to Piper Sandler. Analyst Thomas Champion downgraded Snap and Pinterest to neutral from overweight, saying that advertising-dependent stocks are not great rebound candidates for investors. “After a strong two-year stretch, digital ad spend looks to be normalizing. Group multiples have declined and are ~40% off recent highs, but history suggests multiples may not re-rate until after ad spend growth bottoms,” Champion wrote. The two stocks were re-priced violently last month, after Snap cut its guidance for the second quarter . The company said in a securities filing that the “the macroeconomic environment has deteriorated further and faster than anticipated.” Snap dropped 43% in the session after the announcement, while Pinterest sank more than 23%. Champion said that Piper Sandler’s research supports the concern signaled by Snap. “Last week’s pre-announcement was indicative of deteriorating conditions. Our checks suggest slowing spend in SNAP’s two largest verticals (Media & Entertainment and Apparel),” Champion wrote. Piper Sandler cut its price target for Snap to $18 per share from $30. The new target is about 29% above where the stock closed on Wednesday. Pinterest, meanwhile, may be falling behind its peers in an industry with slowing growth, according to Piper Sandler. “PINS checks remain mixed citing (1) challenged audience growth and (2) a lack of new ad formats. Engagement concerns may persist as PINS competes with more established video-first platforms,” Champion wrote. For Pinterest, Piper Sandler cut its price target to $23 per share from $35. That gives the stock upside of 21.5%. — CNBC’s Michael Bloom contributed to this report.