Twitter Inc. (NYSE:TWTR), Re-targeted Ads, Mobile Monetization And Price Rallies

Posted by admin December 10, 2013 0 Comment 3974 views

Twitter Inc. (NYSE:TWTR)’s stock witnessed biggest intraday gains following its launch day. Yesterday the stock gained 9.32% and closed at $49.14 after having an intraday high of $49.84. Today while the session opens, the stock may hit its new all-time high. Alike its arch rivals Facebook Inc. (NASDAQ:FB) and LinkedIn Corp (NYSE:LNKD), Twitter Inc. (NYSE:TWTR) is not yet profitable but it has successfully harnessed the investor confidence and make them believe in the unique advertising opportunities its micro-blogging platform has to offer.

Retargeted Ads on Mobile Platform

Mobile ads will a matter the most for all internet companies whether it is social media giant Facebook Inc. (NASDAQ:FB) or micro-blogging platform Twitter Inc. (NYSE:TWTR) or a professional networking platform of LinkedIn Corp (NYSE:LNKD). This is because of unprecedented growth witnessed in mobile users over traditional desktop and laptop users.

More than three fourth of Twitter’s 232 million monthly active users are accessing its micro-blogging service via mobiles. Hence retargeting ads on mobile and revenue potential of the same is especially important for Twitter Inc. (NYSE:TWTR).

Unique Advantage

Twitter Inc. (NYSE:TWTR) is proclaiming something which has not worked ever since because mobile phones and tablets could not save users browser history as efficiently as traditional desktops or laptops do and hence retargeted ads is something difficult on mobile platforms. But the micro-blogger has found a way to combine the pieces of fragmented mobile browsing habits.

Brian Nowak, an analyst at Susquehanna Financial Group said, “Twitter expanded a tool that lets marketers target consumers who have already expressed interest in their products based on Web-browsing histories. Such new offerings are helping to justify the stock’s price.”

Peer Comparison

Sarah Frier yesterday reported on Bloomberg that with this price hike Twitter Inc. (NYSE:TWTR)’s stock now trades at approximately 25x projected revenue for 2014 and that too in scenario where the company is not expected to make any profit at least until 2016. This compares to arch rivals Facebook Inc. (NASDAQ:FB) that trades with a price to sales ratio of 12 and LinkedIn Corp (NYSE:LNKD) that trades at 13x of estimated revenue.

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