Shares of Twitter Inc rose on Tuesday after bullish calls from Evercore ISI and Deutsche Bank. CNBC reported that Evercore upgraded the social media company to hold from sell, while Deutsche Bank reiterated its buy rating on the company. The stock gained about 2.5% on Tuesday after dropping 11.5% on Monday. The stock is down more than 19% for the year.
Who Will Acquire Twitter?
The social media company is in talks with several companies about a possible sale. The potential list of suitors include Google and Salesforce. Other reports had listed Verizon as a potential buyer, but it quickly shot down those rumors, noting that it hasn’t submitted a bid.
According to the reports, Twitter will soon release the list of those interested in acquiring the company. The company will reportedly receive a formal bid soon from an array of tech and media firms.
Twitter’s shares have been under pressure as the company’s board remains split between those who want to sell the company and those who don’t. Sources told CNBC on Tuesday that Twitter and Salesforce.com continue to discuss a possible deal. In addition, other large media and tech companies have reportedly also held discussions with the social media company.
Reports suggested that Twitter is working with Goldman Sachs and Allen & Co on the deal.
Twitter Inc has been struggling to attract more users to its platform. As part of its efforts, the company is offering individual content creators a way to make money by sharing their videos on its social platform. The social media firm will offer about 70% of the ad revenue to creators who publish videos on Twitter.
The social media company is trying different options to make it platform appealing to users and content creators. It is offering a new media library for creators with videos, GIFs and images, enabling tweet scheduling and planning, and providing more tools for managing multiple accounts.
In addition to its struggle to gain new users, the social media company has been hit hard with a string of executives leaving the company. In May, the company confirmed the departure of its two key executives.
Analysts Improve Ratings on TWTR
Twitter has been upgraded by Evercore ISI to hold from sell on Tuesday. The firm’s move is based on the recent plunge in the share price. The firm maintains its $17 price target on the stock.
The firm’s analyst Ken Sena said in a note to investors that: “The rating improvement reflects the recent fallout in share price from a stalled sale process, which now places shares more in line with our $17 target. In addition, despite softer checks, we suspect that (third-quarter) guidance may prove sufficiently conservative given the first Presidential debate, the Olympics, and NFL Thursday Night games.”
Twitter Inc is expected to report third-quarter earnings on Oct. 27.
Deutsche Bank reiterated its buy rating on TWTR, noting that the social media company will top expectations when it reports third quarter financial results later this month.
“Amidst intense volatility around whether TWTR is acquired or not, we shift back to what we can track, i.e. — the fundamentals. Our checks point to a ‘high end of the range’ revenue print from TWTR,” Deutsche Bank analyst Ross Sandler said in a note to its clients.