Twitter rallies as Street dissects Rowghani's resignation


Twitter's (TWTR +2.6%) decision to remove COO Ali Rowghani's position "makes sense" given a slower-than-expected pace to product innovation, writes SunTrust's Robert Peck. Like others, Peck isn't surprised by Twitter's move, given recent personnel changes.

The WSJ reports Rowghani's resignation came after CEO Dick Costolo "decided he wanted to take over the product team and streamline the reporting structure so that he oversaw both product and engineering," amid rising pressure over slowing growth. Rowghani's insistence on holding onto the product group "ultimately led to his departure."

Shares have cracked $36 for the first time since Twitter's May 6 lockup expiration.

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Comments (17)
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    Dick Costolo should be the one resigning.
    12 Jun 2014, 02:53 PM Reply Like
  • 22643611
    , contributor
    Comments (2099) | Send Message
     
    This guy was removed for the same basic reason the last two high-ups were.
    They dared to sell their shares.

     

    I agree with manicdvin above - I think Costolo could be the problem.

     

    That said it was definitely greeted well by investors as the stock has rallied nicely.
    12 Jun 2014, 02:59 PM Reply Like
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    Has nothing to do with resignation that stock is up, it's just a quick trade on the momos today.
    12 Jun 2014, 03:06 PM Reply Like
  • 22643611
    , contributor
    Comments (2099) | Send Message
     
    I disagree, the stock has had momentum for about a week now and wether
    right or wrong I think people have perceived this as a positive move for the company (along with the recent upgrades of course) and on a day when most Nas stocks are getting slammed TWTR is up on volume.
    12 Jun 2014, 03:18 PM Reply Like
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    Stock moved on forced upgrades by analysts. Nothing to do with fundamentals. I wouldn't be sitting on any stock long term. You can ride the trade but seems like the trade is limited with indexes now fading.

     

    By end of fall we will either have a Fed driven correction or a major crash. Either way I wouldn't want to be around when QE ends.
    12 Jun 2014, 03:23 PM Reply Like
  • 22643611
    , contributor
    Comments (2099) | Send Message
     
    I don't own TWTR (shorted it on down from $65) and never would as an investment.
    I certainly didn't imply it was up on fundamentals, quite the contrary, it is up in my opinion, as I posted, on the recent upgrades and the "perception" that this resignation is a positive.
    But for a trader it does have good MOMO . . .for now
    12 Jun 2014, 03:33 PM Reply Like
  • Island_Dweller
    , contributor
    Comments (649) | Send Message
     
    Are we watching the same stock? Your assumption is contrary to the stock's movement and volume on a rather significant down day in the averages. Obviously investors have more confidence in Costolo and the rest of management as well as TWTR's employees. According to Glassdoor, TWTR is #2 in best 50 places to work. If Costolo is the problem, clearly the employees and Wall Street don't think so.
    12 Jun 2014, 04:45 PM Reply Like
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    best place work mean millions in stock options... What % was Twitter stock option expense vs revenue again? I rest my case.

     

    Nothing but a scam.
    12 Jun 2014, 05:03 PM Reply Like
  • Island_Dweller
    , contributor
    Comments (649) | Send Message
     
    Rest your case all you want. I enjoy profits.

     

    When people use the word scam while talking about investing it makes me smile. If you want to talk about Bernie Madoff and the like, join an ethics class. Wall Street was, is, and never will be about honesty and upholding the best morals.
    12 Jun 2014, 07:31 PM Reply Like
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    Is this your way of saying you have no constructive response?
    12 Jun 2014, 08:17 PM Reply Like
  • Island_Dweller
    , contributor
    Comments (649) | Send Message
     
    It's my way of saying, "Nothing but a scam," is about as unconstructive as it gets.
    12 Jun 2014, 09:14 PM Reply Like
  • 6269751
    , contributor
    Comments (1535) | Send Message
     
    The first comment was the right on, Dick Costolo is no Steve Jobs, he's a professional manager. It's not easy to know the real story, but if it's true that Costolo really wanted to guide product development (which I doubt) then Twitter is in trouble.
    12 Jun 2014, 04:35 PM Reply Like
  • pbecke
    , contributor
    Comments (34) | Send Message
     
    It seems if twitter really had a product worth engineering, they would be expanding the structure and head count for product development and engineering, not trying to consolidate or "streamline" it. I don't see this as a good sign for twitter. I don't think I have heard of Facebook or Google needing to streamline product development. What's so special about Twitter that they can do more with less talent?
    12 Jun 2014, 05:40 PM Reply Like
  • bullfeathers
    , contributor
    Comments (163) | Send Message
     
    Maybe they realize it's a stretch to expect innovation from a group who's best idea was public web-based text messages...
    13 Jun 2014, 12:00 AM Reply Like
  • 6269751
    , contributor
    Comments (1535) | Send Message
     
    Yes exactly right. A similar platform could be developed by high-school students in a summer "code camp." Money can be made on Twitter however by timing its saw-toothed up and down swings.
    13 Jun 2014, 10:54 AM Reply Like
  • manicdvln
    , contributor
    Comments (1544) | Send Message
     
    Maybe they will put a lemonade stand and add that to their revenue stream. Seriously people if they can't make money on their core business, they will never make elsewhere.
    13 Jun 2014, 11:02 AM Reply Like
  • rstran
    , contributor
    Comments (152) | Send Message
     
    Patience. Now's a good time to buy low.
    14 Jun 2014, 12:41 PM Reply Like
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