The quiet period is over for the major banks covering Twitter.
As a result, all the big-name Internet analysts are releasing their research this morning.
We have a wrap of some of the major banks’ coverage of the stock.
Overall, it’s not great for Twitter, which is trading at $US41.60 this morning, basically flat in the pre-market.
According to data on the Bloomberg terminal, Twitter has 8 buy, 8 hold, and 6 sell ratings, with an average price target of $US39.
Here’s a round up of the coverage.
- Goldman Sachs calls Twitter a buy and gives it a $US46 price target. “We launch coverage of Twitter with a Buy rating relative to our Neutral coverage view as we believe there is substantial long-term value in Twitter’s potential to become the leading platform for real time mass communication. As Twitter grows users, engagement, and monetization through product enhancements, geographic expansion, and advertiser adoption, we see opportunity for growth acceleration and positive estimate revisions. While its growth trajectory is unlikely to be linear, we believe these revisions will, over time, justify considerable upside.” (Via Street Insider)
- Morgan Stanley gives it an “Equal Weighting” recommendation, and doesn’t really give a price target. Morgan seems pretty neutral on the stock. “We are optimistic on Twitter’s ability to expand the socially enabled ad market and take share of TV ad budgets with its “second-screen” ad products. However, a current ~$30b enterprise value appears to reflect a high likelihood of success with these still-nascent initiatives, and we initiate EW … We establish a $US33 base case, at which shares would trade at 13x EV/revenue and 84x EV/EBITDA (2015) against revenue / EBITDA CAGRs of 38% / 90% from 2015-2018. At a current price of around $US42, shares trade at 15x EV/consensus revenue ($1.8b) and 84x EV/consensus EBITDA ($324m; both 2015).”
- JP Morgan is “neutral” on the stock and has a $US40 price target. We don’t have the note. Over at All Things D, Peter Kafka says JP Morgan said teens love Twitter. Via the Bloomberg terminal, we see JP Morgan thinks its fairly valued at this price.
- Bank of America rates it “underperform” and gives it a $US36 price target. It thinks Twitter’s revenue potential is limited versus its peers.
- Deutsche Bank rates it a buy, and gives it a $US50 price target. It thinks Twitter is the best play in mobile for the consumer Internet. It thinks Twitter is going crush estimates because of new ad tools. According to the Bloomberg terminal, Deutsche Bank’s “Model currently reflects DB’s conservative rev. estimates of $US1.2b in 2015, growing at a 30% CAGR to $US2.1b by 2017, well below consensus which should also prove conservative.”
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