Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money

73% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

FREE EBOOK

How to Day Trade Stocks & Indices

  • Place your first trade
  • Identify 9 chart patterns
  • Pro strategies step-by-step

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy. This form is protected by reCaptcha

Don't miss out

Get our FREE Day Trading guide

+ Pro-trader interviews

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy. This form is protected by reCaptcha

FREE Trading guide

Including Day trading strategy examples

+ Pro-trader interviews

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy. This form is protected by reCaptcha

  • Updates

Is Twitter’s share price on the road to recovery?

Is Twitter’s share price on the road to recovery?

Twitter’s [TWTR] share price has gained 40.03% year to date to close at $45.23 on 24 November, but its rise hasn’t been without hiccups. The first major downturn came in March, as Twitter’s share price plummeted 40.22% in a week to $20.00 on 18 March. A steady climb to a 52-week high of $52.93 on 29 October was then abruptly curtailed following its Q3 results announcement, as disappointing user growth sent the social media giant spiralling 26.45% to $38.93 on 2 November. 

Since then, Twitter’s share price has made a tentative recovery, gaining circa 3.5%. Will this continue or is there further downside to come?

 

 

Twitter CEO Dorsey gets latest Senate grilling

CEO Jack Dorsey was grilled by the Senate Judiciary Committee alongside Facebook [FB] CEO Mark Zuckerberg last week. The Committee was called over concerns regarding content moderation policies, specifically focused on the US election. Dorsey was questioned over labels added to false and misleading election-related tweets, which Republicans said were biased against conservatives, while Democrats claimed Twitter had not gone far enough to control misinformation. Democrat senator Patrick Leahy remarked: “I think you can and must do better.”

 

"I think you can and must do better" - Patrick Leahy, Democrat Senator

 

The New York Times reported that Democratic lawmakers called for tech sector legislation, including tougher data privacy laws, changes to a law that gives the companies legal protection for content posted by users, and greater antitrust action. Republicans have also called for reforms to the legal shield protecting platforms for third-party speech. Dorsey agreed content moderation reform is needed, but said his focus was on giving users more tools to control the content they see through algorithms. 

Dorsey has now testified twice in the space of just two months. Such attention is unlikely to help the social media giant in the short term, but a positive outcome could see Twitter’s share price rise. If a conclusion that placates all sides — including US regulators — is reached, it could finally release the shackles on Twitter’s share price. 

 

New features fail to raise Twitter’s share price profile

The social media firm launched a new feature called Fleets last week, which lets users post messages, photos, and videos that disappear after 24 hours. With similarities to Instagram and Snapchat stories, Twitter acknowledged that the format “may sound familiar”. 

“We’ve learned that some people feel more comfortable joining conversations on Twitter with this ephemeral format, so what they’re saying lives just for a moment in time,” the company said. 

Twitter also teased another new feature called Spaces, which would enable audio chats on the app. “We’re always exploring different ways to serve the public conversation on Twitter. Audio is another way for people to share what’s on their minds with their own voice and we see this opening doors to a more collaborative experience.” Twitter told Barron’s

 

"We’re always exploring different ways to serve the public conversation on Twitter. Audio is another way for people to share what’s on their minds with their own voice and we see this opening doors to a more collaborative experience" - Twitter told Barron's

 

Though Twitter’s share price only gained 0.3% to $42.85 on the day, it did comfortably outperform the wider benchmark S&P 500 index, which fell 0.48%. 

 

Where next for Twitter’s share price?

Twitter’s share price has an average 12-month price target price of $45.85 among the analysts tracking the stock, with a high target at $65.00 and a low target of $19.00, according to the Wall Street Journal. Hitting the average target would only represent a 2.62% upside on the current share price of $44.68. 

Of the 38 analysts offering recommendations on Twitter’s share price potential with the WSJ, 10 rate it a Buy, with 24 Hold and four Sell ratings, giving a consensus estimate of Hold. With analysts reckoning on minimal upside and as the threat of greater regulation hangs over the tech sector, Twitter is likely to remain a Hold for the time being. 

 

Market cap $35.803bn
Operating margin (TTM) -2.11%
EPS (TTM) -1.58
Quarterly revenue growth (YoY) 13.70%

Twitter's share price vitals, Yahoo Finance, 25 November 2020

 

Disclaimer Past performance is not a reliable indicator of future results.

CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.

CMC Markets does not endorse or offer opinion on the trading strategies used by the author. Their trading strategies do not guarantee any return and CMC Markets shall not be held responsible for any loss that you may incur, either directly or indirectly, arising from any investment based on any information contained herein.

*Tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK.

Continue reading for FREE

  • Includes free newsletter updates, unsubscribe anytime. Privacy policy

Free ebook

Tricks of the trade: 7 interviews with the world’s top traders

Get it now

Related articles