Its time to talk about $TWTR otherwise known as Twitter.
Current Price: $30.87
52/Wk High: $45.855
52/Wk Low: $20.00
Read below for the breakdown.
We all know about the mainstream social media giant Twitter. From politics to controversy the company has been involved in almost every facet of social communication over the past several years.
Given that, many wonder if $TWTR is a good buy, unfortunately, they have some problems to figure out.
Twitter’s revenue is mostly made from advertising, given that most over Twitter’s activity is based on events the company has struggled due to mass cancelations of sporting events, concerts, and much more.
Due to COVID-19, the company has seen a huge 27% decline in YOY ad revenue in which was reported in March during the Q1 earnings.
Given these issues, Twitter is working on pushing video throughout the service, and attempting to use that for monetization. This is good news but it will be a long path until the company has perfected it.
Getting on to earnings the Q1 report was mixed. While $TWTR beat on earnings estimates with a $0.110 EPS versus the $0.102 EPS consensus the negative news came later during the Q1 Report.
Revenue did uptick at the end of the quarter, Twitter reported a whopping $808 million in revenue but came up short suffering a disappointing $8 million loss.
In the case of further headwinds, the company has a sufficient cash on hand position of $7.671 billion representing an 18.74% increase. (Last reported March 31)
Not only that but analysts a pretty bleak on the social media giant as well. Currently, the average price target is $30.68/share representing a minuscule -0.62% downside.
On the other hand, it must be taken into consideration that the high price target is $42.00/share and low is $23.00/share so analysts are widely in disagreement.
The big money, on the other hand, is relatively bullish with 75.60% of common stock being owned by institutions and insiders. Currently, some of the largest holders include Aristotle Capital Management, Blackrock, and Clearbridge Investments.
Overall I think $TWTR has a long road ahead. Between the resurgence of COVID-19, video integration time, and the current policy position the company is in I believe it will be tough to get ad revenue back on track.
Overall, I like the stock on a larger pullback but it has much more downside before I am in any position to buy.
EAT - SLEEP - PROFIT
Disclaimer: This is not direct financial advice, simply opinion based on independent research.