Rosenblatt Starts Twitter (TWTR) at Buy

(Updated - March 26, 2015 11:13 AM EDT)

Rosenblatt initiated coverage on Twitter, Inc. (NYSE: TWTR) with a Buy rating and a price target of $60.00. Analyst Martin Pyykkonen thinks the company is well positioned for revenue growth and EBITDA margin expansion.

"We estimate a 350bp adjusted EBITDA margin increase for both this year (24.9%) and next year, which would lead to our 28.4% adjusted EBITDA margin for full year (vs. Twitter’s long term target range of 40%-45% adjusted EBITDA margin)," said Pyykkonen. "We think Twitter has an attractive fundamental long-term opportunity to further develop advertising monetization, primarily through targeted advertising and as well this year and beyond with brand advertisers."

On comparison's to Faceboook (Nasdaq: FB), Pyykkonen said, "We don’t think Twitter will approach the size of Facebook’s global active users, but Twitter has at least, if not more so than Facebook, an inherently attractive opportunity to offer advertisers very effective ad targeting, since Twitter’s users self select their interests and subjects to follow and can more anonymously drop those that become of less interest in the future (vs. ‘un-friending’ FB friends)."

"Twitter’s vs. Facebook’s user base (Facebook ~5x vs. TWTR globally) is less relevant than what seems to be the widespread opinion, because at least so far Twitter serves more specific information needs vs. Facebook ... while the specific usage metrics are different between Twitter vs. Facebook, we think analyzing usage, pricing and ad revenue comparisons between Twitter and Facebook is more relevant than simply comparing user growth."

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 $49.50 yesterday.

You May Also Be Interested In

• Craig-Hallum Assumes Guardant Health (GH) at Buy, 'We think that GH is undervalued'
• Bernstein SocGen Group Upgrades CapCom Co Ltd. (9697:JP) (CCOEY) to Outperform
• HSBC Downgrades Anglo American Platinum Limited (AMS:SJ) (ANGPY) to Reduce