So what if Twitter Inc (NYSE:TWTR) is never going to rival Facebook? The microblogging social network showed some promising metrics in its most recent earnings report, but the company’s stock price collapsed in the days following the release. The reason was apparently the slow down in user growth. Investors appear to have ignored the performance of the company in its first quarter, and instead compared the company to an invisible social network it was never trying to be.
A new report about Twitter Inc (NYSE:TWTR) from FBN securities puts a price target of $50 on the company’s stock, and takes a positive interpretation of the company’s most recent earnings reports. The analysts behind the report were impressed by the strides the company made in monetizing its product, though the firm’s impending lock-up puts a short term stall on share purchases.
Baupost's investment process involves "never-ending" gleaning of facts to help support investment ideas Seth Klarman writes in his end-of-year letter to investors. In the letter, a copy of which ValueWalk has been able to review, the value investor describes the Baupost Group's process to identify ideas and answer the most critical questions about its potential Read More
Twitter numbers are looking up
Twitter Inc (NYSE:TWTR) have had a less than positive effect on the company’s shares, and a negative cloud now hangs over the company’s reputation on Wall Street. Despite those factors, FBN Securities is positive about the future of the company, and the most recent numbers support the firm’s suppositions to some extent.
Twitter is monetizing its service faster than most had expected, and the company is doing it while keeping its d load light. It’s unique ability to function as a second screen for TV watchers, and a real time trend watcher give it something different to offer to advertisers. They appear to be jumping on those offerings, and Twitter is offering newer and better technologies to make those offering s more attractive.
Twitter Inc (NYSE:TWTR) now offers TV ratings information in 11 countries, the company recently acquired Gnip to help it track real-time user information and it is doing its best to increase engagement.
According to the FBN report, which was authored by analyst Shebly Seyrafi, Twitter Inc (NYSE:TWTR) is still looking strong, but trends outside of the company are likely to impact the growth in its value more strongly than internal factors. The company is facing compressing market value across momentum stocks, and that makes it a risky asset to own right now.
Twitter stock still risky, despite earnings growth
Twitter Inc (NYSE:TWTR) still isn’t an ideal stock to own, despite the positive numbers coming out of the company’s first quarter. The firm still hasn’t demonstrate an ability to make a consistent profit, and its stock is still valued to grow massively over the next few years. The firm’s moat is more or less impossible to quantify as is the future of the social networking market.
Twitter Inc (NYSE:TWTR) valuation is based on a series of hopes and suppositions about the company’s future. Assuming those are correct, the company has a bright future ahead of it. The risks in the market are great, however, and any value investor worth the name will stay far away from Twitter Inc (NYSE:TWTR), even after the loss of value seen after the earnings report release.