Social Media Giant Twitter to Post Earnings Per Share of $0.35 in Q4

The social media giant Twitter is expected to report its fourth-quarter earnings of $0.35 per share, which represents year-over-year growth of about 8% from $0.38 per share seen in the same period a year ago.

The company would post revenue growth of over 21% to $1.57 billion. Twitter expects revenues of approximately $1.5 billion to $1.6 billion in the fourth quarter of 2021. GAAP operating income is expected to range from $130 million to $180 million, according to ZACKS Research.

With a focus on engineering and products, Twitter expects to increase headcount and costs by 30% or more in 2021. In 2021, the company expects total revenues to grow faster than expenses.

Following Facebook’s disappointing earnings report on Wednesday, shares of social network operators Pinterest, Snap and Twitter all declined.

Twitter stock traded 5.50% lower at $34.48 on Thursday. The stock slumped over 20% so far this year after falling more than 20% in 2021.

Analyst Comments

“Lack of Negative Revisions and Relative Valuation: Valuation continues to be expensive, but we think investors are likely to continue to pay a premium for Twitter (TWTR) given 1) continued turnaround progress and 2) platform scarcity,” noted Brian Nowak, equity analyst at Morgan Stanley.

“Execution Risk Remains Around Driving Advertiser ROI: Advertiser ROI has clearly improved on Twitter, but the company needs to improve ad targeting and measurability to compete with the larger players. To do that it will have to further personalize the content that users see and use its data more effectively, both of which remain key strategic challenges (and priorities) for management.”

Twitter Stock Price Forecast

Twenty-one analysts who offered stock ratings for Twitter in the last three months forecast the average price in 12 months of $52.70 with a high forecast of $80.00 and a low forecast of $32.00.

The average price target represents a 49.97% change from the last price of $35.14. Of those 21 analysts, five rated “Buy”, 15 rated “Hold” while one rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price to $57 with a high of $79 under a bull scenario and $41 under the worst-case scenario. The investment bank gave an “Equal-weight” rating on the social media giant’s stock.

Several other analysts have also updated their stock outlook. Stifel started coverage with a hold rating and set the target price at $39. Bernstein cut the target price to $40 from $75. Jefferies lowered the target price to $40 from $45. MKM Partners slashed the price target to $51 from $77.

Technical analysis suggests it is good to sell as 100-day Moving Average and 100-200-day MACD Oscillator signals a strong selling opportunity.

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