Youssef Squali of Cantor Fitzgerald, in an interview on CNBC, stated that Twitter Inc (NYSE:TWTR) is still a very viable option in the stock market, although at this moment, Facebook Inc (NASDAQ:FB) is a safer bet. “It is all about user growth and usage engagement”, he said, adding that Twitter Inc (NYSE:TWTR) could become a really interesting investment opportunity depending on how Twitter Inc (NYSE:TWTR) changes its platform over time.
Speaking about the numbers buyers need to be on the lookout for, he pointed out, “[…] Back in the fourth quarter they added about 9 million new users, in Q1 they added about 14 million. That is on the right trajectory. We would like to see something at least equal to what they did in Q1 or even a little better.”
Twitter Inc (NYSE:TWTR) should be able to increase their numbers given recent world events.
“They had the advantage of the world cup, they had the advantage of having a whole slew of international crises that usually increases that kind of usage. So, we do expect to see some improvement in the user metric and some improvement in engagement as well,” Squali said.
However, even with all these possible advantages, Twitter Inc (NYSE:TWTR) still has not seen extended time period usage. He pointed out, “The typical user is still not spending all that much time on Twitter”. The average usage time is less than 5 minutes on Twitter Inc (NYSE:TWTR) compared to over 40 minutes on Facebook Inc (NASDAQ:FB).
Twitter Inc (NYSE:TWTR)’s revenue showed a 125% growth in the first quarter, but Squali feels that “these triple digit numbers are going to be very hard to annualize,” and said there will most probably be a deceleration in the coming months. However, the numbers as they stand now make Twitter Inc (NYSE:TWTR) “literally, the fastest grower in the space.”