Twitter shares have taken a nosedive since the beginning of 2014, dropping 42%. From a high of $70 per share, stocks are currently trading around the $37.75 mark. Since Twitter’s flotation, the company has struggled with the balance of keeping both shareholders and end users happy. The last earnings announcement failed to impress the market with the share price declining 10% as user growth slowed. This quarter, Twitter is expected to post marginal losses in revenue to $282.82 billion. Earnings will be announced 29th July 2014, after market close.
Investors Notes:
• Growth in the user base continues to slow, only posting a 6% rise in user base for the first quarter of 2014, since the previous quarter in 2013.
• It is expected that Twitter will post an earnings per share (EPS) of $0.04, despite an EPS of $0.08 during the same quarter last year.
• The market observed increased activity in deep out-of-the-money August call options for Twitter shares, likely due to short sellers covering risk of unexpected stock rally after the earnings announcement.
• From a technical perspective, moving averages indicate a downward trend, with price action below all moving averages with a bearish crossover of short- term moving averages.
• Banc De Binary analysts predict that there will be long-term downward momentum in Twitter stock, indicating a potential long- term downward movement in TWITTER shares.