Twitter Inc (NYSE:TWTR) is not matching up to expectations of people from Wall Street, a group Tony Wible is included. The Janney Capital Markets executive said in a discussion on CNBC that he is disappointed about the outlook of the company for the holiday quarter.
The comments were made by the analyst after Twitter Inc (NYSE:TWTR) reported on Monday that its revenue for the just-ended quarter more than doubled to $361 million, squashing estimates that it would earn $350 million in the third quarter. However, the company’s stock was pummeled after it revealed an outlook of $440 million to $450 million in sales for the fourth quarter of the year, a range which lower end is below the consensus of nearly $449 million.
“I’m disappointed in the sense that there is a lot of optimism coming out of the company aand the numbers just aren’t quite footing with that optimism,” Wible said.
Nonetheless, he said that what is working in favor for Twitter Inc (NYSE:TWTR) at the moment is that going forward, companies need to maintain an exposure in the mobile front. Among companies that are doing the same thing as Twitter – that is, amassing users in a social media platform that lets these users express themselves and be exposed to different organizations or companies – the company is probably the most mobile, Wible noted.
Television, the executive said, is “incrementally weakening” and within the next decade, spending on mobile marketing will be bigger. People are moving away from the desktop, he added.
Twitter Inc (NYSE:TWTR) just got punished in the stock markets because they did not beat more than what people were anticipating, Wible said. He said that pricing and user growth may be decelerating but the company is actually posting growth numbers of about 50%. Nonetheless, he raised the issue of how much the company is paying its employees saying that this dilutes the share base.
Tony Wible has a “Buy” rating on the stock of the company with a price target of $60. Twitter Inc (NYSE:TWTR) shareholders includes John Thaler’s Jat Capital Management which reported about 7.33 million shares of the company by the end of the second quarter.