Twitter rebounds, Facebook makes new highs. Pivotal contrasts the two.


Down 24% yesterday due to the disappointing engagement/user growth metrics provided in its Q4 report, Twitter (TWTR +8.9%) is recouping a portion of its losses today. With 32.7M shares shorted as of Jan. 15, it's likely many shorts are taking profits.

Meanwhile, Facebook (FB +2.9%) is again surging to new highs even as LinkedIn sells off due to weak guidance. Shares are up 20% since the company posted a big Q4 beat.

Though reiterating a Sell on Twitter, Pivotal Research's Brian Wieser suggests Twitter is misunderstood by those making direct Facebook comparisons (previous), and that the former is to the latter as radio is to TV.

Twitter is "a marketing vehicle capable of satisfying different kinds of marketing goals," writes Wieser. Whereas Facebook provides a better environment for marketers to form relationships with consumers and engage in "immersive brand-building," Twitter provides immediacy, a greater proportion of out-of-home mobile activity, and "a greater capacity for in-your-face messaging."

He still considers Twitter overvalued, but believes its Q4 numbers show it's proving quite successful at gaining traction with a variety of marketers.

From other sites
Comments (20)
  • Andrei Volgin
    , contributor
    Comments (624) | Send Message
     
    If users stop visiting Twitter, how exactly marketers are going to "connect with consumers and engage in immersive brand-building"?
    7 Feb 2014, 03:00 PM Reply Like
  • tstreet
    , contributor
    Comments (1035) | Send Message
     
    Twitter gets a ton of attention every day from the mass media. It seems like everybody who is anybody is tweeting. But that's the point. Despite all this attention and the presumed mass popularity, it can't seem to significantly decrease its active users. We are early in the game, here, and yet they are already slowing down to a dribble.

     

    I don't see this turning around although I personally love Twitter. Short this puppy now.
    7 Feb 2014, 03:08 PM Reply Like
  • DanoX
    , contributor
    Comments (3494) | Send Message
     
    Where's the profit?
    7 Feb 2014, 03:19 PM Reply Like
  • benitus
    , contributor
    Comments (3466) | Send Message
     
    Not only are some short-sellers taking profits, which many have done since it went below $50, banks and hedge funds are buying into TWTR to reduce their average costs, even as nervous holders of long positions are liquidating, in anticipation of the lock-up release in mid-Feb, which should see a flood of shares beating each other out the door. I was waiting to increase my shorts at $55 but I couldn't short it until after the end of after-market session. Oh well, there's always tomorrow, if it touches $55 again. This stock is destined to continue its downward slide, once the short-sellers regain their breath, to re-join the rout.
    7 Feb 2014, 03:33 PM Reply Like
  • SharkDude
    , contributor
    Comments (766) | Send Message
     
    30 billion? Incredibly cheap.
    7 Feb 2014, 03:38 PM Reply Like
  • 6269751
    , contributor
    Comments (1544) | Send Message
     
    By the end of the year, TWTR should be down to about half of what it was in 2013. With well-chosen option plays you can make money all during 2014. Eventually Google execs will echo what SharkDude said, except the number will be closer to 10 billion. That will be the final time TWTR stock goes up, when all the shares are purchased. Finally we will be freed from the stupid repetitive comparisons to Facebook.
    7 Feb 2014, 04:09 PM Reply Like
  • SharkDude
    , contributor
    Comments (766) | Send Message
     
    That was my sarcastic point. Cheers!
    7 Feb 2014, 04:50 PM Reply Like
  • tlieu
    , contributor
    Comments (2) | Send Message
     
    More like $40Billion market cap once fully diluted. Whole bunch will be exercisable by insiders in May-Jun timeframe as well. ~$40Billiom market cap for something that hardly has any user growth or profit. Nice.
    7 Feb 2014, 04:21 PM Reply Like
  • kniranjan05
    , contributor
    Comments (3) | Send Message
     
    i feel facebook has wrongly valued.for web stocks yes FB set a standard but real customers for it is only those who wants to build relationships with end customers and gaming/entertainment industry.Understand that this all happening with a deviation from its values since inception and a ton of americans lost interest in FB already officially posted too. so now advertisers what is happening here is ....American advertisers paying for rest of the world traffic (just because thinking its cheaper way) and the fundamental concept that built FB was teenagers/human relationship building... many teens already moving out from FB...so who are those billion users on FB now today? fake accounts,developing countries and people who heard about FB and just see what it is for once in life because of the HYPE created. not even 10-20% of above crowd is customers in realtime american busineses ha ha...

     

    from business value of money i highly appreciate twitter;its a true micro blogging platform for people serious about information ,for individuals and professionals..its really great tool.

     

    for social advertising i recommend Google+ over FB for their established mass application and security management..it may take little time for G+ to be more user friendly..but people will turn to G+..FB is still surviving because applications doing free advertising for FB by accepting FB authentication systems which are now rapidly moving to Google and linkedin aythentications... without that FB is just another Myspace story
    7 Feb 2014, 05:31 PM Reply Like
  • cashawash
    , contributor
    Comments (2621) | Send Message
     
    You need to have an understanding of human behavior -- psychology -- to understand why Facebook is successful. And you will also require an understanding of: marketing, psychology and sociology to really grasp why Facebook is a superior global advertising platform.
    It is not about how you think and feel about FB, or whether you are into Twitter. Put your emotions aside and try to be objective, and really try to understand the business of Facebook with its 1.3 billion global users.
    You will be surprise at what you might discover, pal.
    7 Feb 2014, 08:40 PM Reply Like
  • kniranjan05
    , contributor
    Comments (3) | Send Message
     
    ha ha my friend, am neither a twitter guy nor FB. I am a investor,so simply I look for ROI. my entire objective of above comment is just to say "Value advertising" V/s ER( engagement response). my view at present, if I hold a 100 bucks to advertise some product..I choose G+/Twitter if I need conversion; I choose FB ONLY if Ineed mass engagement but not conversion(except gaming/entertainment industry where engagement itself is conversion).

     

    regarding theories of psychology etc, I see no difference in "business" of FB from a street side honey roasted peanut sellers.(my point is every business has to deal with human behavior,scale varies)

     

    now my personal view on FB is ,
    for short term : am bearish as stock raised around 20% after results so definitely need around 10% correction before making next moves.... (this is where i said over valued)

     

    for long term:absolutely NO IDEA!!! because personally i feel any innovative stock can't be 'valued'.I have seen enough arguments in SA projecting FB from value perspective v/s FB from performance(i.e. innovation component) perspective which contradicts.

     

    finally, 1.3 billion number today or making it to 3.9 billions in near term (by selling FB phones) assuming same no of persons holds 2 phones with FB app doesn't make business sense to appreciate its stock on such numbers to me ,these numbers will retain value when any advertising campaign did for whole group and publish their results . I cant make any comment now because i didn't found such stats. they have a great vision for sure so they are spread in new lands to showcase their difference and legendary from others.

     

    the last point is FB is in critical transformation phase where started off with a successful product " social platform" and 10 yrs continuous innovation to keep its 'users engaged ' and investors 'happy' .so irrespective of ground as long as if it can maintain 'users engaged ' and investors 'happy' it will be in social media business and 'such innovative stock price is just an attribute dictated by markets based on current affairs' because it started business on human emotions ground and shifting from west to east.
    http://bit.ly/1lTzp5d
    10 Feb 2014, 01:40 AM Reply Like
  • 6269751
    , contributor
    Comments (1544) | Send Message
     
    Consider this. Doctors, lawyers, corporations, coffee shops, brands all have Facebook pages - oh yeah and three-fourths billion regular people (Make that an even billion if the WhatsApp deal goes through). It came out a while back that more people look for a doctor on Facebook than in other web venues. It may not be the in thing for teenies, but for a very large number of businesses and private-social people, it is a way to say "yeah I'm on the web too." I will go farther and predict that after multiple stock splits it will be for the investor like having bought IBM in 1955. That's assuming good management which I think Zuckerberg has plenty of time to learn younger than Gates when he made it big.
    20 Feb 2014, 01:15 AM Reply Like
  • benitus
    , contributor
    Comments (3466) | Send Message
     
    Just thinking aloud: one of the things that I hate about texting and using Twitter is that users tend to lose or reduce their ability to punctuate their sentences due to excessive use of what I call "concocted abbreviation" or better still, "contorted abbreviation", which makes reading their messages or posts so difficult to read or understand. My eldest son is one of the greatest culprits because he can write an entire page without even a single punctuation, which is why I never read his emails to me. That's one reason why I don't use Twitter because there're not enough characters for me to write my message. Another reason is that I haven't yet learned how to use Twitter or Facebook, for fear of being addicted to either of them. I do text though, but in complete sentences, albeit short.
    8 Feb 2014, 01:01 AM Reply Like
  • tstreet
    , contributor
    Comments (1035) | Send Message
     
    Above article referred to "in your face messaging". That is precisely what I find annoying. Twitter should be able to fairly accurately gauge user's interests, even more so than Google or Facebook. After all, users are expressing their opinions through their tweets and the people they follow. Instead, I get promoted tweets from corporations who I not only have no interest in but detest.

     

    Offending your users is not a great strategy.
    8 Feb 2014, 10:52 AM Reply Like
  • djfornal
    , contributor
    Comment (1) | Send Message
     
    Remember how many tech companies shares skyrocked during the 80's and then crash a few years later (remember the front page of time with the big bubble and a pin ready to burst it?) We'll just about all of those tech companies recovered and if you would have bought them when they were on the skids, today you'd be smiling.....Same with Apple, Twitter,
    they WILL go up, in fact in my own mind I think apple will be at $600/share by the middle of March 2014 or before, and twitter may take a while longer, but will retrace it's old highs within the next 12 months I believe. Only my opinion, and you know what they say about opinions.....DJ - Lehigh Valley, PA
    9 Feb 2014, 09:57 AM Reply Like
  • Andrei Volgin
    , contributor
    Comments (624) | Send Message
     
    Most of those companies have disappeared. In fact, very few survived and recovered. Do you remember Digital Equipment, Compaq, Gateway? How about Webvan, Pets.com, Excite@Home? Maybe you know what happened to Blackberry?
    9 Feb 2014, 12:15 PM Reply Like
  • PHM70
    , contributor
    Comments (6) | Send Message
     
    This stock is going to sink.. The only thing propping it up is the small float and that will change on May 7th when 454m shares will be unlocked for sale. That is less than 90 days away. It is simple math. The float is only 70m now and 454m shares are coming in less than 90 days. Plus they are on the verge of starting to actually lose users (the declining timeline view was just the first warning shot). I see a tragedy happening to Twitter shareholders throughout the year. No one needs a micro blogging site for modern life and this will soon to be proven true...
    9 Feb 2014, 12:18 PM Reply Like
  • Moon Man
    , contributor
    Comment (1) | Send Message
     
    I know many busy people with Facebook accounts that can't possibly be bothered with Twitter. These are 5%-ers or better. Twitter's audience is limited and due to its constancy, Facebook is not. It may be the second screen, but really, who's going to do that all the time?
    9 Feb 2014, 12:52 PM Reply Like
  • cashawash
    , contributor
    Comments (2621) | Send Message
     
    I absolutely disagree with the notion that Twitter cannot, and will not be a viable business.
    There is a place for Twitter in the Social Media universe. However; it will not be a giant enterprise equivalent to Facebook. The last earnings report for both companies was quite revealing.
    FB has gotten over it's issues and is the incomparable leader in the Social Media sector.
    While it was nice, flattering, and beneficial for Twitter to be seen as the equal to Facebook, their earnings report and CC, revealed a company, equivalent in size to Instagram.
    Twitter has challenges, that will occupy management for the next; 24 to 30 months.
    This is all proof that Facebook's challenges following it's IPO, where not only confined to
    FB, but that; Twitter has it's own share of hurdles, that management will need to successfully address, before investors will feel comfortable with the strategy going forward.
    So, give Twitter's management time to shape, and align the business before we can issue a judgement. Twitter should be a successful business, but they probably wont be equal in size, scope, nor reach as FB.
    Facebook and Twitter are two separate entities, however; some of their markets do intersect, and that is fine because a horse, and dog can drink from the same pond in perfect harmony, eh.
    9 Feb 2014, 03:27 PM Reply Like
  • DanoX
    , contributor
    Comments (3494) | Send Message
     
    Twitter needs to make a profit now, a small growing month to month profit like Google or Facebook after their IPO's, particularity the way Google did at the beginning, and Twitter needs to do it soon.
    9 Feb 2014, 03:58 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs