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Inside Twitter’s Recent Stock Performance: An Analysis

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TWTR’s 100-day moving average

During the most recent trading session, Twitter (TWTR) was trading at 50.3% above its 100-day moving average. By comparison, peer Facebook (FB) was trading 0.9% below its 100-day moving average, while Amazon.com (AMZN) was trading 23.3% above its 100-day moving average. Alibaba (BABA) was trading 0.9% above its 100-day moving average, and Alphabet (GOOG) was trading 4.8% above its 100-day moving average.

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Analyst recommendations

Twitter was given a “buy” by seven of the 38 analysts covering the stock. Ten analysts recommended a “hold,” while 21 recommended a “sell.” The analysts’ stock price target for TWTR is now $27.7, with a median price target of $28.

Shareholder returns and stock trends

Twitter has generated investor returns of 34.1% in the trailing-one-month period and 102.2% in the trailing-12-month period. The company’s share price has gained 4.9% in the trailing-five-day period.

By comparison, peer companies Facebook, Amazon, Alibaba, and Alphabet have generated investor returns in the trailing-12-month period of 32.5%, 71.6%, 82.2%, and 32.8%, respectively.

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All eyes on Twitter’s price multiple

Twitter’s book value per share works out to $6.8, while its estimated book value per share is $7.3. The stock is trading at a price-to-book value of 4.9x.

The company’s price-to-sales ratio was 10.1x in 2017, and its estimated price-to-sales ratio for 2018 is 9.1x.

Twitter’s cash flow metrics

Twitter has $4.4 billion in cash on hand. Its price-to-cash-flow and price-to-free-cash-flow calculate to 29.5x and 36.6x, respectively. For the trailing 12 months, the company’s EV-to-cash-flow was 26.4x, and its EV-to-free cash-flow was 32.7x.

Twitter’ scale

Twitter was the smallest Internet player in terms of market capitalization globally at ~$24.6 billion. By comparison, Facebook’s market capitalization was ~$515.2 billion, while Amazon’s market cap was ~$701.3 billion. Alibaba’s market cap came in at ~$470.4 billion, and Alphabet’s market cap came in at ~$761.1 billion.

In the next part of this series, we’ll look at some recent developments in Twitter’s advertising business.

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