Twitter Inc (NYSE:TWTR) Starts 2014 With 5 Percent Gains

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Dallas, Texas 01/02/2014 (FINANCIALSTRENDS) – Twitter Inc (NYSE:TWTR), the popular micro-blogging site has managed to reverse some of the sharp drop in its market valuation that it experienced during trading last week during trading yesterday. When the markets were closed for the day on the first day of 2014, the stock of this $30 billion market capped tech upstart was trading at $63.65 per share which translates into a 5.19 percent increase over its previous day close.

This significant rebound managed to mask some of the inherent weakness in the stock which was manifest during trading last week, when the stock of Twitter Inc (NYSE:TWTR) posted a shocking 13 percent dip in value in just one day of trading on December 27. It seemed like the markets had over reacted when the stock managed to post a recovery when markets commenced on Monday, only to see investors once more sell the stock short. Thus in a two day trading span, Twitter Inc (NYSE:TWTR) share holders watched in disbelief as the company’s market cap shrunk by $7 billion and the stock price lost close to 17 percent of its valuation in a two day period.

The lack of investor confidence in the stock was triggered by news that rating agency Macquarie downgraded the stock to a sell from its previous call of neutral. The analyst Ben Schachter who authored the unflattering report of Twitter Inc (NYSE:TWTR) for Macquarie has been quoted as saying, “We continue to believe that Twitter as a company has a bright future and many opportunities ahead. However, as a stock, we believe nothing has changed over the last 15 days to justify the rise in valuation.”

Readers should note that since its debut on the stock market in the form of IPO in November 2013, the stock has posted 53 percent in its valuation. While this is definitely appreciable growth, one should remember that Twitter Inc (NYSE:TWTR) is yet to post profits from its operations even after being in business for the past seven years.

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