Victor Anthony: Twitter Inc (TWTR)’s Fall Was Expected


Twitter Inc (NYSE:TWTR) shares plunged more than 14% at Tuesday’s close and hit a record low following the expiration of the company’s post-IPO lockup period. It lost another 5% today. The company’s stock was hit after the end of the lock-up period for insiders and early investors to sell their stock. The regulatory documents reveal that the company’s more than 85% shares were in lockup at the time of its IPO.

Talking to CNBC, Victor Anthony, managing director of Topeka Capital Markets, said the pullback in the Twitter Inc (NYSE:TWTR) shares was anticipated, and there were many factors that led the shares of social media company to reach to a new low. Following the Russia-Ukraine crisis and slowdown in China, investors are going to sell high-multiple and high growth stocks, and they are moving into more value-added stocks, according to Victor Anthony. Also, another factor was Alibaba’s filing for an initial public offering in the United States.

Anthony noted that Twitter Inc (NYSE:TWTR) shares are expected to remain under pressure for next few days. According to him, the company is monetizing quit efficiently.

Twitter Inc (NYSE:TWTR) has a market cap of $17.3 billion. The company reported higher gains in the first quarter of 2014.Revenue for the first quarter was $250 million, representing a 119% increase from $114 million in the same period last year. The company’s advertising revenue totaled $226 million, an increase of 125% year-over-year.

For the second quarter of 2014, Twitter’s expects revenue to be in the range of $270 million to $280 million. The company anticipates the full year of 2014revenue to be in the range of $1,200 million to $1,250 million.

Twitter is a trying many things to grow its business and impress investors. Recently, the social media company announced a partnership with Amazon to allow users add automatically items to their online shopping cart. Shoppers can do this by replying a tweet with an Amazon product link and the hashtag #AmazonCart, US Today reported.

After seeing an Amazon product link shared on Twitter, users can respond to that tweet with the hashtag #AmazonCart. Once the message is sent, an item will automatically be added to the user’s cart to purchase later. In order to use this new feature, users are required to connect their Twitter feeds to their Amazon accounts.

Currently, Twitter Inc (NYSE:TWTR) stock trades at $30.33. Analysts have a consensus average target price of $45.63. The consensus rating of the stock is a Hold.