Twitter’s stock has been swinging all over the place in the last month, usually moving 5% up or down on a daily basis.
Today, it’s up 4%, and the catalyst seems to be a bullish note from Goldman Sachs. Most sell-side analysts have been downgrading Twitter price target on valuation fears. They think the stock has run too hot, too quickly.
Goldman’s Heath Terry is going the other way. He’s keeping his “buy” rating and upping his target to $US65, from $US45 previously. The stock was at $US57 before he made his call.
Terry says Twitter launched 23 product enhancements in Q4, which he thinks is 4X what it’s ever done in a quarter. He thinks that Twitter’s site is now stable, so it can focus on building the product. (We’d also note that management is solid, so it can execute on a cohesive vision for the product.)
Terry believes these product innovations will increase engagement and revenue. So, he’s raising his targets.
Here’s a chart he included showing how the product was changed in Q4:
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