Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
Login Archives Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
    ×
  • Subscribe
Enter stock ticker or keyword
×
Join 100,000+ Like-Minded Investors Today
Twitter
Tags: Stocks

Why the Twitter Stock Price Is Near Historic Lows Today

By Jack Delaney, Sr. Cannabis Editor, Money Morning • January 12, 2016

Start the conversation

Leave a Reply Click here to cancel reply.

You must be logged in to post a comment.

Twitter stock price  The Twitter stock price climbed roughly 3% earlier this morning (Tuesday), but the TWTR stock rally was short-lived. Before noon, the Twitter stock price was down 0.66% from its opening price.

And we see the Twitter Inc. (NYSE: TWTR) stock price continuing to be extremely volatile in 2016...

On Monday, Twitter stock was selling for as low as $19.26 per share before closing at $19.65. At Monday's low, the TWTR stock price was down 25.9% from its IPO of $26 per share.

The TWTR stock price was climbing this morning after Twitter published a blog post detailing new features for its broadcasting app, Periscope.

Twitter acquired the live-broadcasting app in March 2015 for an undisclosed amount.

Periscope allows users to share a live feed of themselves that other Periscope users can watch in real time. Now Twitter will integrate live broadcasts as well as replays directly into tweets.

The app is part of CEO Jack Dorsey's campaign to add more monthly active users (MAUs). Twitter boasts that Periscope users have created over 100 million live broadcasts.

But an update to Periscope isn't enough to make TWTR stock worth buying...

You see, Periscope doesn't generate revenue, and Twitter doesn't appear to have a clear plan for monetization.

Plus, there are two major obstacles for Twitter when it comes to monetizing Periscope:

  • Videos are deleted after 24 hours for public viewing. That only leaves advertisers with a limited time frame to have their ads viewed and clicked on.
  • Users typically don't want to view ads in the middle of live broadcasts through non-traditional media because the broadcasts are intimate and personal. It would be similar to having ads appear in the middle of slideshows someone shared with their family.

Whether Periscope can add to Twitter's MAU growth remains to be seen, but Periscope will certainly not add to Twitter's revenue growth any time soon.

And that's only one of the reasons we're bearish on TWTR stock in 2016...

You see, there is a fundamental flaw with Twitter that Periscope highlights. This flaw has led to three different CEOs since its inception, a volatile Twitter stock price, and sluggish MAU user growth...

The Twitter Stock Price Will Remain Volatile in 2016

The fundamental flaw behind Twitter is that the social media site has never established a clear purpose.

Co-founder and former CEO Evan Williams and Jack Dorsey have always been at odds about what Twitter is and how it should be used.

In his book "Hatching Twitter," New York Times reporter Nick Bolton highlighted how Dorsey always felt like Twitter was a tool for sharing what was happening to you specifically. Williams believed it was a platform to share events around the world.

The difference is subtle but critical for TWTR shareholders.

Williams has always believed that Twitter's ability to deliver news is its strength and that it should be viewed as a news service provider. Dorsey thinks that the purpose of Twitter is to share what you are doing with friends, family, and other Twitter users.

That caused Twitter to become a combination of both CEO's visions. Periscope now blurs that even further.

Periscope could be used to share videos of an earthquake, but it could also be used to broadcast someone shoe shopping.

Advertisers have a clear understanding of what Facebook Inc. (Nasdaq: FB) is and the extensive reach Facebook has with its 1.55 billion MAUs. That has helped the Facebook stock price climb 160% since its IPO.

But Twitter remains a confusing platform for users and is far behind Facebook in MAUs...

Twitter only added four million MAUs in Q3 2105 from Q2 2015. That brought its total count to 320 million. Investors look for large increases in MAUs because advertisers pay for extensive reach. The larger Twitter is able to grow its audience, the more advertising revenue it can earn.

But Twitter has fallen behind Facebook's mobile picture app Instagram in MAUs. Instagram reported 400 million MAUs in September.

The Twitter stock price is down 11.93% in 2016 and has plummeted 41.62% in the last six months. Because of its many issues, it shows no clear signs of recovering in 2016.

The Bottom Line: The Twitter stock price will remain volatile and underperform until the company establishes a clear purpose. CEO Jack Dorsey has yet to find a way to make Twitter more attractive and seem easier to new users. New offerings like Periscope are currently financial drains that have yet to prove they will actually add MAUs to Twitter.

Jack Delaney is an associate editor for Money Morning. You can follow him on Twitter and follow Money Morning on Facebook.

 Profit Alert: Since Money Morning Executive Editor Bill Patalon launched his Private Briefing program just a few short years ago, he's recommended 192 stocks that have either doubled or tripled in value. The service has completely revolutionized the way people invest. Keep reading to find out more about his extensive research and premium stock picks...

Here Are 10 “One-Click” Ways to Earn 10% or Better on Your Money Every Quarter

Appreciation is great, but it’s possible to get even more out of the shares you own. A lot more: you can easily beat inflation and collect regular income to spare. There are no complicated trades to put on, no high-level options clearances necessary. In fact, you can do this with a couple of mouse clicks – passive income redefined. Click here for the report…

Claim My Free Report

Subscribe
Login
Notify of
guest

guest

0 Comments
Inline Feedbacks
View all comments


Latest News

September 22, 2023 • By Shah Gilani

earnings
Why the Fed's "Higher for Longer" Message on Interest Rates is Bogus

September 22, 2023 • By Tom Gentile

This is the Top 'Worst-in-Breed' Stock Heading into October

September 21, 2023 • By Shah Gilani

earnings
The Best Auto Stocks to Buy (or Avoid) Right Now
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Penny Hawk Midday Momentum
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Quantum Data Profits Flashpoint Trader Darknet Alpha Accelerators Brutus Alerts Resource Traders Alliance L.A.U.N.C.H. Investor Rob Roy Trader Long-Term Equity Profits

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz