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Date of earnings release
26/10/17 after-market
The story
Anybody buying Twitter shares is buying into a ‘turnaround story’. Expectations that one can happen are low. There is a potential double bottom around $14 but management need to offer reasons for optimism. The result of its trial of more characters in a tweet could be one source of optimism, but anecdotally it went down badly with its core user base. Perhaps more encouraging is video livestreaming. Twitter is best at breaking news, which live video can complement very well. Video is good for advertising and can entice a younger audience. There is still a shortage of evidence that Twitter can rekindle falling user growth and monetise existing users.
Price chart
Price performance
5yr + -60.3%
YTD +9.6%
Since last earnings +2.9%
Earnings
Q3 EPS expectation: 0.064 (Adjusted), -0.105 (GAAP)
Q3 Revenue expectation: 587.483 million
Chart of Revenue history and expectations
Source: Bloomberg, 23/10/17
Chart of Net Income history and expectations
Source: Bloomberg, 23/10/17
Valuation
Forward 12M P/E ratio: 56.7
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