Twitter Inc ’s stock is down 30% this year. But that hasn’t made former CEO Dick Costolo lose confidence in the micro-blogging site. He remains bullish, and believes his successor Jack Dorsey is on the right track.
“I’m confident the team will capture the value,” Costolo said in his first TV interview since leaving Twitter.
Dick Costolo is Still a Big Twitter Bull
Speaking on CNBC, Costolo praised Jack Dorsey as the right man for the job. “I’m a big believer in Twitter; I’m a big believer in Jack.”
Costolo announced he was stepping down in June. Co-founder Dorsey ultimately took over. But Wall Street continues to remains cautious. Investors are concerned that Twitter Inc ’s growth in monthly user base hasn’t been strong enough. Twitter finished third quarter with 320 million active monthly users. That pales in comparison to Facebook’s 1.55 billion.
But Costolo defended the network, saying its scale and reach is enormous.
“The resilience and strength of the network is incredible. You can’t wake up or go throughout the day without seeing Twitter content.
Twitter has been trying hard to increase its appeal among a much wider audience. The recently launched Moments, is one such feature that should make using the platform easier for the average user.
Dick Costolo also disclosed during the interview that he still owns a significant number of shares of Twitter. “The vast majority of my personal and family’s net worth is Twitter stock.”
Twitter Has the Potential to be a $100 Stock
Twitter Inc shares have been tumbling since the firm’s latest results highlighted another disappointing quarter of user growth. MKM Partners’ Rob Sanderson has joined others on Wall Street to cut the stock’s target price from $31 to $29 per share.
Interestingly, despite the bearish take on Twitter, he believes the stock could see significant upside if the firm manages to simplify user experience, and in the process, enhance the site’s appeal.
Sanderson reckons that if Twitter succeeds in becoming “mainstream-relevant,” the stock could head as high as $100. But in case of “significant deterioration of the network,” shares could tumble to as low as $10.
“We think that simplifying the user experience could open the mass market for Twitter, double its market cap and put the company in position to double again,” Sanderson wrote to clients on Monday.
“Moments is the most ambitious attempt to streamline the user experience and showcase the best of Twitter. Other product improvements are on the roadmap. But we view Moments as the key initiative for the next several quarters.”
Shares of Twitter Inc closed Tuesday at $25.27.