Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nasdaq  >  Facebook Inc    FB

SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector newsTweets 

Facebook Inc : Investors dump Twitter stock as results divide Wall Street

share with twitter share with LinkedIn share with facebook
share via e-mail
0
02/06/2014 | 04:17pm CET

Twitter Inc's shares fell almost 25 percent on Thursday, wiping out about $9.8 billion in market value, after the company reported a sharp slowdown in user growth.

The stock, which debuted at $26 in November, hit a low of $50 in early trading. The shares hit a peak of $74.73 in late December as investors bet that the social media platform could become as ubiquitous as Facebook.

Analysts, unlike investors, were divided on the company's outlook a day after it reported fourth-quarter results.

Twitter, according to broker assessments, is either the overvalued owner of a niche product whose potential is fading or an undervalued phenomenon that is set to give Facebook a run for its money in mobile.

"We remain firmly in the latter camp..." said Deutsche Bank, one of one at least six brokerages that raised target prices or ratings on Twitter's stock.

Deutsche, in a note entitled "Great Quarter, Aside From The Most Important Metric", said it was impressed by Twitter's improving monetization and expected slowing user growth to reverse during 2014.

The broker, which sees Twitter on its way to 1 billion user, maintained a "buy" rating on the stock and raised its price target to $65 from $50.

Facebook has about 1.2 billion users.

UBS, on the other side of the argument, issued a "sell" recommendation on the stock and cut its price target to $42 from $45. It was one of at least eight brokerages to cut their target prices or recommendations on Twitter's shares.

"A lack of mainstream adoption or a more simplified use case was a worry of ours coming out of the IPO and seems to have come to the fore faster than we had anticipated," UBS analyst Eric Sheridan said in a note.

Twitter reported better-than-expected fourth-quarter revenue of $243 million in its first results since the IPO.

Investors, however, zeroed in on the anemic user growth, as well as a sharp decline in a measure of user engagement.

Twitter averaged 241 million monthly users in the December quarter, up just 3.8 percent from the previous three months. That was the lowest rate of quarter-on-quarter growth since the company began disclosing user figures.

But the company also said it made $1.49 per 1,000 timeline views, a 76 percent jump from the same quarter of 2012.

"We believe the accelerating user growth and engagement, supplemented by improvements in monetization, will drive continued financial outperformance in the year ahead," Goldman Sachs analysts said in a note.

Goldman raised its target price to $69 from $65 and maintained its "buy" rating on the stock.

Twitter CEO Dick Costolo expressed confidence that Twitter's user growth would improve in 2014 once users get used to a change in layout to help new users and take to a new onboarding process for newcomers to Twitter's mobile app.

"Management offered lots of confidence in reaccelerating those (active user) figures, but that will likely become a 'prove it' story that will make stock outperformance challenging in the meantime," BMO Capital Markets analyst Daniel Salmon said in a note to clients.

Up to Wednesday's close, Twitter shares had risen to about 30 times projected 2014 sales.

(Editing by Ted Kerr)

By Saqib Iqbal Ahmed

Stocks treated in this article : Facebook Inc, Twitter Inc
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on FACEBOOK INC
03/22 Snap pops 9 percent after winning second 'buy' recommendation
03/22 Snap pops 9 percent after winning second 'buy' recommendation
03/21 Google and sister company to offer cyber security to election groups
03/21 XLMEDIA : Dau-Up Granted Partner Status For Instragram
03/21 NO ID, NO BENEFITS : thousands could lose lifeline under India’s biometric..
03/20 FACEBOOK : expected to launch consumer hardware products
03/19 FACEBOOK : Hopes to Combat Fake News With New Warning Label
03/18DJGoogle Vows More Control for Brands Over Online Ads -- Update
03/17DJGoogle Vows More Control for Brands Over Online Ads
03/17 FACEBOOK INC : Today's Research Reports on Stocks to Watch: Facebook Inc. and Sn..
More news
Sector news : Social Media & Networking
02:04p J&J latest to suspend ads from YouTube over offensive videos
11:57aDJALIBABA : Today's Top Supply Chain and Logistics News From WSJ
10:41aDJTENCENT : Hires Baidu Big-Data Director Zhang Tong, Betting on Artificial Intell..
09:02a Verizon, AT&T suspend ads from Google over offensive videos
09:02a Verizon, AT&T suspend ads from Google over offensive videos
More sector news : Social Media & Networking
News from SeekingAlpha
10:01a Buy Facebook And Michael Kors, Sell VeriSign And Time Warner
10:00a INSIDERINSIGHTS.COM DAILY ROUND UP 3 : Pjt, strs, psec, tlf
07:53a COVERAGE UPDATE : Is Snap A Buy, Alphabet A Hold?
03/22 Instagram reaches one million active advertisers
03/22 INSIDERINSIGHTS.COM DAILY ROUND UP 3 : Vive, trnc, fsc, srg
Advertisement
Financials ($)
Sales 2017 37 861 M
EBIT 2017 21 213 M
Net income 2017 12 819 M
Finance 2017 37 114 M
Yield 2017 -
P/E ratio 2017 31,66
P/E ratio 2018 24,58
EV / Sales 2017 9,67x
EV / Sales 2018 7,28x
Capitalization 403 412 M
More Financials
Chart FACEBOOK INC
Duration : Period :
Facebook Inc Technical Analysis Chart | FB | US30303M1027 | 4-Traders
Full-screen chart
Technical analysis trends FACEBOOK INC
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 47
Average target price 160 $
Spread / Average Target 14%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Mark Elliot Zuckerberg Chairman & Chief Executive Officer
Sheryl Kara Sandberg Chief Operating Officer & Director
David M. Wehner Chief Financial Officer
Michael Todd Schroepfer Chief Technology Officer
Atish Banerjea Chief Information Officer
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
FACEBOOK INC21.33%403 412
TENCENT HOLDINGS LTD19.53%274 641
TWITTER INC-8.10%10 889
LINE CORP4.36%8 227
SINA CORP16.12%5 004
MATCH GROUP INC-5.03%4 157
More Results