- Rosenblatt analyst Barton Crockett maintained Twitter, Inc (NYSE:TWTR) with a Neutral and cut the price target from $54.2 to $33, below Tesla, Inc (NASDAQ:TSLA) chief's takeover bid.
- Crockett believed that the absence of the deal would lead to even lower share prices for Twitter.
- Social media comparables were already hit by a possible weakening ad market likely to become more pronounced if the economy trends toward recession.
- The disruption of Musk talking about substantial changes to Twitter's business focus could reduce employee effectiveness.
- The economic slowdown has decreased the loss of key talent as rivals have restrained hiring.
- However, relative to these peers, Twitter is more exposed to brand advertising, which appears to be a weaker part of the ad market than direct response.
- Crockett believes the Twitter and Elon Musk deal is still likely to move forward, with Musk owning ample leverage to rework the deal price substantially.
- All of which could lead to an ugly, tortured road leading to substantial share price volatility in the interim.
- Price Action: TWTR shares traded higher by 3.02% at $38.94 on the last check Tuesday.
- Photo by Pete Linforth from Pixabay
