Twitter (TWTR) PT Raised to $58 at SunTrust Robinson Humphrey

SunTrust Robinson Humphrey analyst Robert Peck reiterated a Buy rating and raised his price target on Twitter, Inc. (NYSE: TWTR) to $58.00 (from $45.00) following Q2 results.

Peck highlights, "1) Topline growth accelerates for 4th straight quarter driven by 129% ad rev growth; 2) MAU net ads of 16M, best in 5 quarters; 3) ARPU accelerated, but still only ~50% of FB; 4) Data revenues up 90% shows traction in data/ad suite including MoPub; 5) Incremental margins accelerated to 28% vs. EBITDA margins of 17%. We remain positive on the growth outlook for one of the few platforms of the Internet."

He also highlighted: "2Q POSITIVES. 1) Monetization – ARPU of $1.05 up 84% y/y vs 77% in 1Q, driven by US of $3.12 up 72% and Int’l $0.46, accelerating, up 127%. TWTR monetization rates per user are ~50% vs. FB, consistent with 1Q driven by lower ad load, more nascent targeting and ad format changes. We expect this gap to narrow over time. 2) User engagement – stats on World Cup highlight large ON and "OFF-Twitter" reach for the platform. Management noted "hundreds of millions" of users visit Twitter but are not logged-in and thus are not monetized or counted in MAUs – scale of platform is "2-3x" the MAUs. 3) Incremental margins – EBITDA margins of 17% and incremental margins of 28% showcase leverage. We see target model of 35-40% EBITDA margins as achievable while investing. 4) MoPub / Data Licensing – strong as integration continues (included a partial quarter of Gnip)."

The firm's 1014 rev and EBITDA forecast goes to $1.34B (+101% y/y) and $236M (17.6% margin) from $1.29B and $213M while 2015 goes to $2.18B (+63% y/y) and $514M (23.6% margin) from $2.12B and $485M.

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 $38.59 yesterday.

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