Another Downgrade For Twitter Inc (NYSE:TWTR)
Twitter Inc (NYSE:TWTR) stock which just turned two months old at the stock markets has had a forgettable start to its 2014 at the stock market. In the past full week of trading the stock has shed close to 6.8 percent of its market cap. During trading yesterday, the investor sentiment turned further south, thanks to which the stock of this micro blogging site which is yet to show profits after being in operation for past 7 years, shed close to 3.5 percent of its market value.
This latest lack of investor confidence in the stock was triggered by another downgrade, this time by Cantor Fitzgerald. Yesterday’s downgrade comes fast on the heels of another downgrade on January 6, in which CRT Capital overturned its December 17 recommendation of Buy to Fair value. It also predicted the price range of the sock to range less than $60 from its earlier prediction of $65. These steady downgrades seem to add more weight to analyst Elliott Waves December prediction that the share price of Twitter Inc (NYSE:TWTR) are likely to settle as low as $55.
Reasoning behind The Downgrade
In yesterday’s commentary accompanying the downgrade, Cantor Fitzgerald opined that the current valuation of this $28.1 billion market capped firm is excessive in its opinion and recommended a Sell rating on the stock. The agency has set the cat among the investor pigeons by continuing to advocate a price target of $32 on the stock as against yesterday’s close price of $59.29 per share. They have voiced a big question mark on the modalities being invoked by various rating agencies while covering the stock of Twitter Inc (NYSE:TWTR) by stating that they find a “major discrepancy” between analyst estimates of financial firms which helped the blogging site go public vs the agencies which are covering the stock post the public trading commencement.