Twitter Inc (NYSE:TWTR) witnessed steep slip in pre-market stock trade on Monday. The Q1 results for the company are imminent. There are growing concerns and rumors are milling around about TWTR’s performance related issues.
Buy Or Hold, Do Not Sell
Analysts seem cautious over TWTR’s business outlook. Robert Peck has put the stock with a ‘Buy’ rating for the past one year. He chose to go with a neutral rating; however, he has put his price target within the range of $50 and $58. TWTR’s shares performed pretty well since the excellent results in Q4, beating the company’s expectations by a wide gamut. TWTR soared 23% when S&P 500 Index gained 2.7% merely.
Declining Tweets Adding To Concerns
Analysts are pondering over calculated or negative risks for Twitter Inc (NYSE:TWTR), where it is believed that the company should do well enough and have a strong Q1. The concern for Robert Peck that guided him to make such a reserved neutral stake for TWTR is justified by reviews by other analysts. Declining tweets on a per-day average, decelerating new customer acquisitions and the outlook for Q2 net users per month have made room for lowering net guidance.
Ad-Led Growth Expected To Pump Up
The company has fared fairly well in guiding revenue growth. The TWTR management hopes to make 80% revenue growth in Q1. Backed by exquisite growth in international and mobile based advertisement campaigns, the company is slated to reach out to increased advertisement load levels. Further, driven by substantial operating leverage, year-over-year marginal growth is expected to grow.
Hitches Faced During Q12015
The rampant increase in user-base had picked up over the past few months. However, integration issues on the iOS8 platform and a seasonally poorer quarter have led to a slowdown. There is hope that the overall sales in the subsequent quarters are deemed to pick up.
Ad revenues are likely to grow further; advertising revenues are expected to pump up more than 75%. Mobile and advert based revenues would pick up. The stock seem poised for substantial growth in ad-based and user-focused revenues in the US and other global markets.