"140 characters ought to be enough for anybody.."-Bill Gates
Twitter is a social networking & micro-blogging site (Both Exe and web format) that connects users to people, information, ideas, opinions, and news. Recently, Twitter touched all-time high as investors welcomed the social network's new targeted advertising feature. After huge successful Initial Public offering (NYSEARCA:IPO), micro-blogging site Twitter has been trying to ensure that it grabs that proverbial worm. After the IPO, it has been trying to change the strategy to some extent to stay above of the competition. They have been able to stay ahead of the competition due to their innovative approach.
We tried to highlight little key change in approach & try to touch its valuation.
1) Presently it has more than 230 million monthly active users generate more than 500 million Tweets per day. We think it is just the beginning. These numbers will continue to rise phenomenally in the future.
2) They are trying to add more women power in their team. Then announced appointment of Mrs Marjorie Scardino as the eighth board member of the all-white-male board. It is trying to re-discover them .
3) Twitter to Feature across all phone - Come March 2014 and Twitter can be in very hand on each and every phone. We feel that the new growth is going to come from this segment.
4) Twitter to focus on data mining business.
5) The newly launched tool, known as "tailored audiences" will allow advertisers to reach consumers based on their browsing history, allowing brands to identify potential customers. This could be a potential driver for twitter revenue growth. IT is going to be a key marketing tool for advertisers.
Though twitter continues to chart its growth roadmap. However, investor believes significant challenges are ahead of them. There has been a downgraded of the stock due to due to high costs, rapid adoption of TV related product and amplification risk associated.
Twitter is a growth investing. Probably justify the present valuation at this point of time is very difficult. One has to look at this stocks based on the long-term opportunity for the company.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.