Twitter Inc. (NYSE:TWTR): The Stock Lost Over 35% Year-to-Date


Dallas, Texas 05/06/2014 (FINANCIALSTRENDS) – Twitter Inc. (NYSE:TWTR) recently announced its 1Q14 earnings on April 29, 2014 where it reported significant widening in its net loss which deepen to $132.4 million or $0.23 per share as compared to net loss of $27 million or $0.21 per share during 1Q13. The stock lost more than 10% on the same day and hit an all-time low price of $37.24 on April 30, 2014.

During the last week, the stock shed around 6.22% and more than 35% year to date. On Friday, the stock traded almost flat, losing around $0.07 or 0.18% from its previous close and ended the session at $39.02. The previous closing depicts that the stock is trading almost 48% below its 52 week high of $74.73 and 25% below its 200 day simple moving average.

The Overpriced Stock:

Despite hitting out life-time low, the stock of micro blogging site, Twitter Inc. (NYSE:TWTR) was regarded as “overpriced” by Barron in one of its recent most article. The article read, “Twitter trades at a big premium to other Internet stocks based on its price/sales ratio, and its user growth is slowing. Twitter appears to be a long way from profitability, based on conservative accounting that properly treats as an expense its massive stock-based compensation to employees.”

The article further mentioned that the stock price could further down slide towards $30 levels, from its previous close of $39.02. The article also regarded its U.S. user base of 57 million as “plateauing” despite Twitter’s constant efforts to make its platform more appealing.

Struggle to Grow User Base:

Twitter Inc. (NYSE:TWTR) recently reported that its membership reached to 255 million users during 1Q14 which suggest a year over year growth of 25% as compared to 30% reported during the previous period. However, the Chief Executive Officer of twitter, Dick Costolo said that the company is experiencing signs of accelerating user growth, primarily in the U.S. and he is “tweaking” the company’s product to retain and draw users.