Morgan Stanley Slashes Target Price to $16 For Twitter Inc.

Twitter Inc. has been making an effort to make its platform more engaging for users and add more customers to the platform however analysts at Morgan Stanley feel that the company will not be able to achieve much of that in the near future.

Twitter Inc. just can’t catch a breath. Due to projected slow user growth, revenue and earnings analysts at Morgan Stanley came down hard on the micro-blogging website as they lowered their forecast for Twitter stock.

In a note to investors, Brian Nowak, an analyst at Morgan Stanley stated that Twitter has had some trouble in keeping its current users engaged and along with that the social media website’s user trend remains troubling as well. Due to this reason, Morgan Stanley has slashed its twelve year target price to $16 from an initial one-year price target of $18. Furthermore, the financial services and research firm also reduced its projects for fiscal year 2017 by 13% to $769 million. Along with that it also reduced the revenue forecast of the micro-blogging website to $3.23 billion which indicates a slash of 6%.

The social media network has been struggling to keep users engaged on the website and has failed to increase the number of users on Twitter; apart from its user-base of politicians, celebrities and journalists, the social media site has found it difficult to attract mainstream social media users onto the website. In an attempt to attract these users, Twitter signed a deal with U.S. National Football League to stream its games on the platform so that it can drive more videos onto its platform from the NFL.

Morgan Stanley has maintained its Underweight rating on the stock of the micro-blogging platform. Furthermore the firm mentioned that the average time spent by a U.S mobile user on Twitter fell by almost 10% in the first quarter of 2016 in comparison to the same quarter in the previous year. However, in comparison to the previous year’s same quarter the new mobile app downloads were the same.

The note also suggested that any new users that might be added on the platform will be solely due to the deal that the social media network signed with NFL, the U.S. Presidential Elections as well as the Olympic Games. The analyst wrote that at this point fewer users are seen on the platform and even those that are on the platform are seen using the service for lesser time.

The analysts at the research firm are expecting that usually in the first quarter of the year the active user growth is reported to be fair however this time they are predicting that the social media site will not be able to report strong numbers when the company releases its earnings results on April 26. 

Twitter Inc. Is Redesigning its Timeline Outlook

The social media network is changing the way you view your timeline on Twitter.

On March 3, 2016, Twitter users will be able to witness a whole new look of the micro-blogging website’s timeline display as it had decided to redesign the entire format, which will include embedded profiles, collections and lists. During the Flight Developer Conference held in October, Twitter stated that it will be rolling out its embedded grids which would also display publisher’s profiles and posts well tired together on their timeline.

After this new display feature is launched, users will be able to integrate their profiles and posts together with the help of the new timeline – however, they will not be bound  to maintain their customized settings and no changes will be made to that unless the users himself does so.

With the help of the redesigned timeline display publisher’s posts and profiles will be shown in a more rich and responsive manner and will get a better response. Another thing that the user will not have to worry about is the ‘remove media’ option. As per the new default settings, the content will automatically be expanded on the posts and tweets of the publisher.

Twitter is making its efforts to attract more traffic towards its website, and this feature is an example of that. By promoting its content outside of the social media site it is exactly heading in that direction; as through this people who are not signed up on the website yet can still see posts made by publishers. It is making sure that its efforts do not go in vain as the update will be providing benefit to not only the publishers but also the developers.

On the other hand, Twitter stock has gone up by almost 25% after touching its all-time low a few weeks back but it is still 30% below its Initial Public Offering – IPO share price of $26. Analysts believe that if the social media giant ever wants to reach its IPO share price, it will have to work on getting as many users on its platform as possible – user growth is the only way Twitter can get back in the social media game again. However, a number of analysts do not have a bullish stance on the stock of the company – 27 analysts have given the stock a rating of ‘Hold’ while 13 have suggested a ‘buy’, as per the report by Thomson One Analytics.

Twitter Inc Loses Four Top Executives

Twitter stock has been called 'Junk' after the departure of four top executives; analysts believe the management won't bring better days for the company.

On Sunday, the chief executive officer of Twitter Inc. confirmed the news of four top executives leaving the company that included Katie Stanton, Kevin Weil, Skip Schipper and Alex Roetter. The major problem of the organization solely lies in its inability to attract users. After the news of the four executives leaving surfaced, the stock of the company plunged 4% during the trading session on Monday.

An analyst at Global Equities, Trip Chowdhry called Twitter stock – junk. The stock expert believes that the micro-blogging company’s stock is likely to fall to $5 per share. He strongly believes that bringing in a new team of executives will not bring a change and the stock will still be categorized with GoPro, Box and Fitbit; it will never reach to Facebook Inc.’s level.

As Kevin Weil, the core product head leaves the company, Adam Messinger will be taking his place who was initially the technology chief. He has been working for the company for over five years so the employees are quite familiar with him; currently Twitter is not looking to hire a new product head, according to the social media network’s spokesman.

Time after time, the social media website has stated that the worst days are over when only it is always just a beginning of such days. Initially when the board re-appointed Jack Dorsey and chief financial officer Anthony Noto was hired, the same statement was made, according to which the company was to see better days. Unfortunately, better days have not yet arrived for the micro-blogging website.

Mr. Chowdhry, after being so cynical, still believe that there is hope for the company as it can expand and promote itself in Asian countries including the second largest country in terms of population, India. He stated that it could become a tool for the government to keep a check on the citizens and could make investigations easy as well.

He also suggested that in case the website shows signs of gaining more users, it would be the perfect time for the investors to sell the stock. He added that the novelty aspect of the stock is going away so the investors should seize the opportunity since it will be quite difficult for the stock to regain its novelty.

Additionally, the CEO stated that after Mr. Messinger is appointed as the product head, he will be working closely with him – day and night to work on building a better experience for the users. The stock, on Monday fell by 4.6% and is currently being traded at a share price of $17.02, which is close to year another all-time low.

Twitter, Inc. Hit A New All-Time Low Share Price On Friday

The social media website has hit a new all time low yet again after its initial all time low share price back in August 2015.

On January 8, 2016, Twitter Inc.’s stock dropped by as much as 2% hitting its new all-time low at $19.76. In the past five trading days, the stock has managed to drop by 15% due to poor user growth. Investors have been quite unhappy because of the sluggish user growth of the social media network. Ever since ex-CEO and co-founder of Twitter, Dick Costolo stepped down from his position in June; the company has been constantly going through a rough patch.

The investors at Wall Street have continuously questioned the strategic direction of the micro-blogging company while others have pointed their fingers at the slow user growth for the decline in the stock. Ever since its one year high of $53.49 back on April 7, 2015 Twitter stock has fallen by as much as 60%. In October, the social media website reported better than expected earnings for the third quarter for fiscal year 2015. For upcoming further quarter, investors and analysts are predicting revenue to be somewhere between the range of $695 to $700 million.

For the latest quarter, 320 million active users were reported by the organization which shows that the monthly active users have just increase by 4 million since its last report. The fourth quarter earnings for the current fiscal year are expected to come out on February 10, 2016. The stock, at this point in time, is in a crisis situation.

In other news, Jack Dorsey stated that he has been looking for different ways in which Twitter users can post tweets specifically something that lets the users make longer tweets. He added that the customers of the social networking website are already doing that by posting the screenshots of the text but he said he would like the tweets to be short, sweet and conventional. According to the announcement, the tweets will now be of 10,000 characters per person from an initial 140-character limit.

It could mark as the end of Twitter when other smaller rivals such as Snapchat and Vine are giving its users more attractive features and options through which they are able to attract a good audience. Back in November 2013, when the company went public it was trading at a share price of $26 per share on the NYSE. The first fall that it witnessed was back in August when it dropped below its initial public offering price and this was the second hit.

Stock of the micro-blogging website is down 22% since it went public but it is not the lowest performing stock; in comparison Square stock is as low as twitter’s as well. It has fallen about 13.8% this week.