Twitter (TWTR) Slammed as Illusive Dorsey News Seen as Bittersweet

After rising 5 percent yesterday on headlines Jack Dorsey was to be tapped as permanent CEO as soon as today, Twitter (NYSE: TWTR) is under heavy pressure today (-6.3%) as the announcement has still yet to come and as the implications sink in. Some investors are asking "why the delay now?", while others are saying "this is no change."

The reaction illustrates investors' frustration with the stock, which is below its IPO price and down 55% from its 52-week high.

Most investors want the company to get the CEO appointment over with so they can move on with other business. If Dorsey is in fact the candidate, the delay shows a lack of caring for shareholders, some say. If he is not, it begs the question "then who?" as candidates are seen as scarce.

Analysts are also questioning Dorsey's dual-CEO role. In a note to clients this morning, Nomura analyst Anthony DiClemente said, "The notion that Jack Dorsey would serve as CEO of two public companies gives us pause, particularly given that concerns persist regarding Twitter’s user growth trajectory and ability to stem deceleration in monetization trends."

The analyst said while naming Dorsey should mitigate concerns over the direction of leadership, they are less certain of his ability to drive effective structural change, particularly if he continues as CEO of Square.

"Given that Mr. Dorsey has overseen Twitter since inception as CEO and Chairman, it is unclear the extent to which his ascension to permanent CEO will result in change that addresses major concerns regarding user growth trajectory and improved monetization," he said.

Square's pending IPO, which is said to be weeks away, just exacerbates matters.

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