Bull Of The Day: Twitter

The brutal Q4 market correction is making many growth stocks investable again and one of them is Twitter (TWTR - Free Report).

Actually, Twitter saw a strong rally off of its October lows after reporting a 50% EPS surprise for Q3 but has slid back over 25% in the six trading sessions up to December 24.

The good news is that the stock held above those October lows just above $26 and should be on growth investor "buy lists" as the market stabilizes.

My colleague Tracey Ryniec chose Twitter for a Bull of the Day feature in November and some of her post-earnings notes are worth reviewing...

Twitter is winning over Wall Street quarter by quarter. This Zacks Rank #1 (Strong Buy) is expected to grow both revenue and earnings by the double digits in both 2018 and 2019.

Twitter operates a social media platform in 40 languages around the world that provides users with updates on what is happening, including breaking news, globally.

Big Earnings Beat in Q3

On Oct 25, Twitter reported its third quarter results and beat the Zacks Consensus Estimate by 7 cents. Earnings were $0.21 versus the consensus of $0.14. That's a beat of 50%.

Revenue rose 29% to $758 million, up from $590 million.

Of that total revenue, most came from advertising revenue which rose 29% to $650 million. Half of the advertising revenue is now coming from the video ad format.

Wall Street is always watching the Daily Active Users count, which fell to 326 million from 335 million in the second quarter but that was mostly the result of the company's policy of purging fake, spam and abusive accounts.

(end of excerpt from Tracey's Nov 14 report)

Social Media Growth That Isn't Fake News 

The metrics that jump out to me here, besides the big bottom line beat, are year-over-year revenue growth of 29% -- on pace to break $3 billion this year -- in an environment where social media is under big clouds of political controversy.

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Disclosure: Kevin Cook is a Senior Stock Strategist for Zacks Investment Research and he may be starting a long position in Twitter ( more

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