Twitter Inc shares were up strongly in pre-market trading on Monday morning after Bob Peck of SunTrust upgraded the firm’s shares. Mr. Peck said that shares in the firm were now a Buy as he believes that a CEO will be picked before Labor Day. Twitter revealed on Friday that it would hold a board meeting on September 3.
Mr. Peck put a $38 price target on shares in Twitter and upgraded the firm Buy from Hold in the report released on Monday morning and put a price target of $38 on shares. At time of writing shares in Twitter were selling at $27.57, up more than 2 percent for the day so far. Shares of Twitter crossed below $27 on August 20, and didn’t rise above that value until this morning.
Twitter Inc shares boom on CEO Talk
Mr. Peck still thinks he knows what Twitter is going to say about its CEO choice, but his timeline on the pick has changed. In a previous report Mr. Peck said that Twitter would keep Jack Dorsey as CEO, put Adam Bain, head of global sales, as President, and install Ev Williams, one of the firm’s founders, as chairman of the board.
Mr. Peck said about a month ago that he expected the pick to come in before Labor Day, but changed his mind and forecast a CEO would be chosen in the middle of August. That prediction didn’t come to pass, but traders are buying into the idea that his original forecast on the firm’s plans will hold true.
Mr. Peck said that Twitter looked stronger than previously aside from the coming CEO pick. He said he was “cautiously optimistic” about the firm’s future and mentioned that user metrics were likely to improve on the back of the changes that have been made to the product in recent weeks.
Twitter shares crushed
Shares in Twitter have been crushed in recent weeks as the lack of a firm leader multiplies the firm’s other problems. Twitter has seen a lot of talent run for the hills in recent months, and every move it wants to make on the product front is aped and release by Facebook before Jack Dorsey and his team have a change to finish it.
In the last three months shares in Twitter have lost more than 26 percent of their value. Last Monday shares, among a massive collapse on Wall Street that lasted just hours, hit their all time low of $21. This morning, if the pre-market rally holds, shares will have broken free from their IPO price and put together their fourth straight day of gains.
That will mean a lot to those who bought into Twitter at any time since its 2014 IPO and last week. Almost every person holding Twitter shares was below their buy in price last week. That’s the kind of shareholder pressure that a new CEO will have a lot of trouble dealing with.