By Stephen Karmazyn, BA

Published: December 21, 2016

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Stephen Karmazyn, BA
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Twitter Inc: Why TWTR Stock Is Getting Killed

Twitter StockTwitter Inc (NYSE:TWTR) is down 4.5% on Wednesday afternoon, following another management shake-up and negative forecasts by analysts; issues that have been plaguing TWTR stock for much of 2016.

The incoming U.S. commander-in-chief might be a Twitter enthusiast, but the markets have been decidedly anti-TWTR stock on Wednesday. The departure of Twitter CTO Adam Messinger and VP of Product Josh McFarland has not helped breed confidence among investors. Couple that news with analyst doomsayers projecting TWTR stock falling as low as single digits, and you can see how we arrived at Wednesday’s fall.

The shake-up in the upper echelons of Twitter is by no means a sudden or novel occurrence. Just last month, COO Adam Bain departed the beleaguered social media company. (Source: “Twitter’s CTO Adam Messinger is leaving the company along with VP of product Josh McFarland,” TechCrunch, December 20, 2016.)

Neither has 2016 been a particularly kind year to Twitter stock, with TWTR stock falling 26% since the beginning of the year.

Perhaps most worrying for TWTR stock shareholders is how the changes at the top will ripple down through the company. Will the rank-and-file employee be concerned about the shifts in leadership? Will the Twitter stock compensation—being as low as it is now—still be enough to draw top talent?

And then there’s the analysts decrying the stock as a dud. Trip Chowdhry, the managing director of equity research at Global Equities Research, LLC, wrote a note on Tuesday claiming that Twitter stock is “toast” and “not even a $10 stock.” Chowdhry also claimed that TWTR stock buyers are building an “investment thesis based on complete stupidity.” (Source: “Twitter is ‘toast’ and the stock is not even worth $10: Analyst,” CNBC, December 21, 2016.)

But all is not grim for Twitter stock. While the company has hit a rough patch in recent years, there are still a couple rays of hope shining through the darkening sky over TWTR stock. The first comes by way of live streaming, which the company has done with National Football League (NFL) games, and plans to do so with the Golden Globes pre-show.

Another ray of hope is in the chances for acquisition. Several companies have approached Twitter looking to make a deal, including salesforce.com, inc. (NYSE:CRM), though the talks never bore fruit.