Jefferies Group LLC lowered shares of Twitter, Inc. (NYSE:TWTR) from a buy rating to a hold rating in a research report sent to investors on Thursday morning, Marketbeat reports. They currently have $16.00 target price on the social networking company’s stock, down from their prior target price of $20.00.
“clear winner” in the social media space, and it isn’t Twitter.While Twitter’s social media platform does have a strong brand image, advertiser ROI has “dissipated” over the years, Thill commented in his downgrade note. In fact, a steady improvement in engagement from its core users hasn’t translated into revenue growth for the company which implies “monetization is slipping” at a time when the digital advertising industry is growing at more than 15 percent.Meanwhile, Twitter’s desire to become a global leader in digital live video is “interesting” but the company is overshadowed by much larger peers, including Facebook Inc (NASDAQ: FB) and Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL). Both Facebook and Alphabet “have much stronger digital video propositions for advertisers with much larger and more engaged user bases,” the analyst added.Moving forward, there are three areas in which Twitter needs to demonstrate improvement, including:Increased adoption from advertisers which will translate to growing ARPU (average revenue per user).A return to growing its user base in key regions like the U.S. and Europe.Improvements in user engagement and matching revenue growth.Bottom line, while recent management changes in the company could improve various aspects of Twitter’s business going forward, the “clear winner,” Jefferies Group LLC’s analyst commented.
Several other analysts have also weighed in on the company. Vetr upgraded Twitter from a buy rating to a strong-buy rating and set a $19.17 price target on the stock in a report on Monday, June 12th. Zacks Investment Research upgraded Twitter from a hold rating to a strong-buy rating and set a $18.00 price target on the stock in a report on Friday, April 28th. Goldman Sachs Group, Inc. (The) restated a buy rating and set a $20.00 price target on shares of Twitter in a report on Friday, April 28th. BidaskClub upgraded Twitter from a sell rating to a hold rating in a report on Saturday, June 24th. Finally, Wells Fargo & Company restated a market perform rating on shares of Twitter in a report on Saturday, July 22nd. Sixteen equities research analysts have rated the stock with a sell rating, twenty-five have assigned a hold rating and five have assigned a buy rating to the stock. The stock presently has a consensus rating of Hold and a consensus target price of $15.49.
Shares of Twitter (NYSE:TWTR) opened at 16.65 on Thursday. The firm’s 50-day moving average is $17.54 and its 200-day moving average is $16.82. Twitter has a 12-month low of $14.12 and a 12-month high of $25.25. The company’s market capitalization is $12.20 billion.
Twitter (NYSE:TWTR) last released its quarterly earnings results on Thursday, July 27th. The social networking company reported $0.08 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $0.05 by $0.03. Twitter had a negative return on equity of 2.91% and a negative net margin of 18.25%. The company had revenue of $574 million for the quarter, compared to analyst estimates of $536.63 million. During the same quarter in the prior year, the firm posted $0.13 EPS. Twitter’s quarterly revenue was down 4.7% compared to the same quarter last year. On average, equities analysts predict that Twitter will post $0.34 EPS for the current year.
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In other Twitter news, insider Robert Kaiden sold 2,815 shares of the firm’s stock in a transaction that occurred on Thursday, June 1st. The stock was sold at an average price of $18.37, for a total value of $51,711.55. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, General Counsel Vijaya Gadde sold 15,000 shares of the firm’s stock in a transaction that occurred on Wednesday, August 16th. The shares were sold at an average price of $16.07, for a total value of $241,050.00. The disclosure for this sale can be found here. Over the last three months, insiders sold 2,489,473 shares of company stock worth $45,041,152. 10.79% of the stock is owned by corporate insiders.
A number of hedge funds have recently modified their holdings of the stock. Vanguard Group Inc. raised its stake in shares of Twitter by 6.2% in the second quarter. Vanguard Group Inc. now owns 48,836,225 shares of the social networking company’s stock valued at $872,704,000 after buying an additional 2,838,459 shares during the last quarter. Clearbridge Investments LLC raised its stake in shares of Twitter by 17.8% in the first quarter. Clearbridge Investments LLC now owns 36,805,927 shares of the social networking company’s stock valued at $550,249,000 after buying an additional 5,561,940 shares during the last quarter. OppenheimerFunds Inc. raised its stake in shares of Twitter by 42.3% in the first quarter. OppenheimerFunds Inc. now owns 10,088,428 shares of the social networking company’s stock valued at $150,822,000 after buying an additional 2,999,690 shares during the last quarter. Northern Trust Corp raised its stake in shares of Twitter by 78.3% in the second quarter. Northern Trust Corp now owns 8,350,037 shares of the social networking company’s stock valued at $149,215,000 after buying an additional 3,667,233 shares during the last quarter. Finally, First Trust Advisors LP raised its stake in shares of Twitter by 10.8% in the second quarter. First Trust Advisors LP now owns 7,248,583 shares of the social networking company’s stock valued at $129,532,000 after buying an additional 705,208 shares during the last quarter. 47.36% of the stock is currently owned by institutional investors.
About Twitter
Twitter, Inc offers products and services for users, advertisers, developers and data partners. The Company’s products and services include Twitter, Periscope, Promoted Tweets, Promoted Accounts and Promoted Trends. Its Twitter is a platform for public self-expression and conversation in real time. Periscope broadcasts can also be viewed through Twitter and on desktop or mobile Web browser.
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