6/5/2015
Twitter Inc (NYSE:TWTR)
I bought this around $30/share and as expected it rebounded more than 30%, actually it shot up 80% in 5 months. That would've made for a great trade, but as in investor was it worth it and is it still worth it? Kinda.
Price at write-up $36.80
Target $50
Valuation Ratios
Price/Earnings (TTM) . . . . .Neg
Price/Sales (TTM) . . . . . . . 15.13
Earnings per share . . . . . . .-0.98
Price/Book (MRQ) . . . . . . .6.5
Price/Cash Flow (TTM) . . . Neg.
Held by institutions . . . . . . .56.47%
Short interest . . . . . . . . . . . .5.02%
Dividend . . . . . . . . . . . . . . .NA
MarketCap 24.0B
I originally wrote about Twitter in May of 2014 when Twitter employees were finally free to sell their shares . The strategy I've previously described of buying stocks when there is a dip for merely sentiment reasons and selling them when they return the mean easily applied here. Twitter was a good trade and is a good trade but it was previously a better investment. If you haven't invested yet, this would not be an unreasonable time to do so at around $33 as it should easily climb back to $43 a share. I'm not as convinced as I previously was that they would successfully monetize the product without destroying it in the process, so I'm not as keen on it as a long-term investment. If you currently own it, or are thinking of picking it up I would seriously suggest re-evaluating your stake when the price is north of $50/share. I'd happily sell it at $70 simply because I'm not sure what direction the management will take it, which currently seems to be a very Amazon-like growth at the expense of profit - though it has worked thus far for Amazon.
There's quite a bit of risk here though for those reasons and others, but the growth in earnings per share are encouraging. This stock is on sale but is it for a reason? Yes, it's failed to produce the expected revenue. Will it rebound? Probably. What to do then is a hard decision, I'll likely sell half of my significant holdings the next time it hits $55 - or at least re-evaluate my position. Naturally I'd like them to be consistently cash flow positive, but I suspect that's too much to ask.
Due Diligence - FB, YHOO, LNKD
Twitter Inc (NYSE:TWTR)
I bought this around $30/share and as expected it rebounded more than 30%, actually it shot up 80% in 5 months. That would've made for a great trade, but as in investor was it worth it and is it still worth it? Kinda.
Price at write-up $36.80
Target $50
Valuation Ratios
Price/Earnings (TTM) . . . . .Neg
Price/Sales (TTM) . . . . . . . 15.13
Earnings per share . . . . . . .-0.98
Price/Book (MRQ) . . . . . . .6.5
Price/Cash Flow (TTM) . . . Neg.
Held by institutions . . . . . . .56.47%
Short interest . . . . . . . . . . . .5.02%
Dividend . . . . . . . . . . . . . . .NA
MarketCap 24.0B
I originally wrote about Twitter in May of 2014 when Twitter employees were finally free to sell their shares . The strategy I've previously described of buying stocks when there is a dip for merely sentiment reasons and selling them when they return the mean easily applied here. Twitter was a good trade and is a good trade but it was previously a better investment. If you haven't invested yet, this would not be an unreasonable time to do so at around $33 as it should easily climb back to $43 a share. I'm not as convinced as I previously was that they would successfully monetize the product without destroying it in the process, so I'm not as keen on it as a long-term investment. If you currently own it, or are thinking of picking it up I would seriously suggest re-evaluating your stake when the price is north of $50/share. I'd happily sell it at $70 simply because I'm not sure what direction the management will take it, which currently seems to be a very Amazon-like growth at the expense of profit - though it has worked thus far for Amazon.
There's quite a bit of risk here though for those reasons and others, but the growth in earnings per share are encouraging. This stock is on sale but is it for a reason? Yes, it's failed to produce the expected revenue. Will it rebound? Probably. What to do then is a hard decision, I'll likely sell half of my significant holdings the next time it hits $55 - or at least re-evaluate my position. Naturally I'd like them to be consistently cash flow positive, but I suspect that's too much to ask.
Due Diligence - FB, YHOO, LNKD