Deutsche Bank analyst Lloyd Walmsley upgraded Twitter to Buy from Hold with a price target of $56, up from $36. The stock closed Friday down 11c to $45.90. The shares should continue to re-rate higher with improving growth in the second half of 2020 ns a “compelling bull case” for 2021, Walmsley tells investors in a research note. The analyst believes Twitter is well positioned to benefit from an event and a cyclical recovery. The company has turned around its user product and has been driving a “nice pickup” in monthly daily active user growth over the last few years, a trend that can continue on a multi-year basis, says Walmsley. Further, Twitter is well positioned to benefit from a “big event landscape” in 2021, expansion into more performance advertising on the back of its advertising server rebuild, and an eventual high-margin subscription product, adds the analyst.
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