Deutsche Bank Remains Bullish on Twitter (TWTR)

Deutsche Bank maintained a Buy rating on Twitter, Inc. (NYSE: TWTR) with a price target of $50. Analyst Ross Sandler said he remains firmly in the bull camp and he expects revenue to slightly exceed consensus in Q3.

"Twitter has had a rough 2015, full stop. The investment community has more or less given up on the story, except for a few loyal enthusiasts. We remain firmly in the bull camp and believe a string of positive news should start to materialize, including 1) Moments (ie - Project Lightening) ships October 6th and could be the key to converting casual Twitter users into regulars, pushing the company more into the mainstream, and could potentially turn around the anemic MAU growth (somewhat Snapchat Discover-esk), 2) For 3Q, we are expecting better than consensus revenue and flattish MAUs, similar to 2Q, 3) Lastly, the CEO seat will likely be filled in the near-to-medium term along with a BoD re-shuffle, which should help sentiment," said Sandler.

"Our checks continue to point to solid revenue trajectory in most markets, including US direct sales, self-serve and international. We think revenue should slightly exceed consensus revenue of $559m, despite over-concerns and noise in the investment community, with consistent margin expansion (DB EBITDA of $113m). We don’t see MAUs picking up materially in the September quarter, consistent with management commentary throughout the quarter. The key to the story in the short term is whether “Moments” (i.e. Project Lightening) can attract and engage new users, and if Twitter can improve retention trends. The company should have 3 weeks of data by the time they report 3Q, hence we are cautiously optimistic," added the analyst.

For an analyst ratings summary and ratings history on Twitter, Inc. click here. For more ratings news on Twitter, Inc. click here.

Shares of Twitter, Inc. closed at $24.68 yesterday.

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