Twitter Inc (TWTR) Remains “Anti-Fragile” Despite Concerns

Twitter Inc (NYSE: TWTR) is in the limelight these days after Citron Research lowered the stock’s price target to $20 from $25 in December. Citron’s Andrew Left said in his report that Twitter has become “uninvestable”, citing a report by Amnesty International, which shows that about 7% of the total tweets toward women are “problematic” or “abusive.” Some analysts, however, believe that the problem cited in the report by Amnesty International aren’t grave, as Twitter is already working to solve these issues. In July, it was reported that Twitter closed a whopping 70 million fake and suspicious accounts. This massive account purge had a direct effect on the company’s user growth numbers, but the Twitter’s management said the security of the platform remains its top priority.

Twitter’s Selloff is Overdone

JPMorgan was quick to reject Citron’s doubts. The investment firm said in a report that the reaction following Citron’s comments is “overdone”. The firm’s analyst Douglas Anmuth said that Twitter Inc (NYSE: TWTR)’s actions to improve the health of the platform will ultimately result in an increase in engagement and advertising. JPMorgan reiterated its “Overweight” rating and gave a price target of $45 per share. Twitter stock is also among JPMorgan’s top internet stock picks for 2019.

Earlier in December, financial services firm Guggenheim started covering Twitter stock with a Buy rating. The firm has a price target of $39. Guggenheim’s analyst Michael Morris also said that Twitter management’s efforts to improve user experience and delete fake accounts will result in a boost in advertising revenue. The analyst expects the company to report mid-teen revenue growth through 2023, which would support about 25% annual earnings and FCF growth.

Twitter Inc (NYSE: TWTR)’s third-quarter results reported in October came in above the analysts’ forecasts. After the results, Goldman Sachs’ Heath Terry maintained a Buy rating and increased its price target to $48.

Earlier in 2018, a major Twitter bear MKM Partners’ Rob Sanderson turned bullish on the stock. The investor thinks Twitter will see a major improvement in its ads revenue. Sanderson said in his note that Twitter has become a “go-to source” to find out all the happenings in the world. The analyst said that Twitter’s nature is “Antifragile” and the company is here to stay.

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