Twitter (TWTR) Estimates and Price Target Lifted at Goldman Sachs

Goldman Sachs analyst Heath Terry raised estimates and his price target on Twitter, Inc. (NYSE: TWTR) to $55.00 (from $40.00) while maintaining a Buy rating citing monetization and quality initiatives.

Terry said they continue to believe that consensus underestimates the company's ability to: 1) drive incremental engagement through new features and information quality initiatives, 2) better monetize engagement as advertiser leverage newer targeting and measurement functionality, and 3) show significant operating expense leverage as incremental revenue flows to the bottom line.

He adds that the concerns around the impact of the newly announced quality initiatives on user metrics, that has weighed on the stock, should not be a worry as checks with advertisers and 3rd party traffic data suggests the changes will be a net positive.

The analyst said the company's faster growth versus the sector, the significant upside potential to estimates, and additional option value in Twitter as a platform more than justly the premium multiple

The firm raised 2018-2020 revenue and adj. EBITDA estimates by +4%/+6% on average.

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