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Twitter Jumps as it Crushes Views

Stock (Symbol) Stock Price

Twitter (TWTR)

$48

Data is as of Expected to Report Sector

February 13, 2015

Apr 27 – May 1

Technology

Sharek’s Take
David SharekTwitter jumped from $40 to $48 this month after announced record earnings that beat the street. Sales doubled in 2014 and could double again in 2015. Last qtr, the company made 12 cents, blowing past the 6 cent estimate. Before that, the most the company ever made since going public was 2 cents a share, and had beaten the street by 3 cents in 3-of-4 qtrs. Is this a new awakening in profitability? Could be. Although the 128 P/E ratio is high, high growth/high P/E stocks as they are leading the stock market, and I see TWTR making $1 in profits next year. With triple digit profit growth now and in the future forecasts, there’s a possibility this stock could roll higher. Even if it doesn’t I love the long-term outlook of this company.
One-Year Chart
TWTR_2015_Q1I love the triple-digit profit growth TWTR has been getting, and that’s expected to continue through most of this year. The only negative is the 126 P/E but that’s the era we are in today — rapid growth is very expensive.
Earnings Table
TWTR_2015_Q1_EPSRevenue soared 97% last qtr as profits jumped 500%. 
 
TWTR was on a roll of beating the street by 3 cents in 3 of the last 4 qtrs. But last qtr it just met estimates, which hurt momentum. The 6 cent beat turned momentum up.
 
Annual Profit Estimates moved a little bit higher.
 
Quarterly estimates show triple-digit profit growth could continue at least 3 more qtrs.
Fair Value
TWTR_2015_Q1_PHI think TWTR could make $1 next year, and buy then my purchase could be through of as a good move. But line many stocks in the current market, it’s priced high because its growing so fast.
Ten-Year Chart
TWTR_2015_Q1_10yrWild ten-year chart because TWTR was all-hyped-up when it first went public. Then people forgot about the stock just as profitability spiked.
Power Ranking Bottom Line
Growth Portfolio

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Twitter is one of America’s top franchises and shares of such stocks are being sent higher by investors thirsty for growth. I feel this is a great franchise to own for the long-term and we have the added bonus that the stock is timely right now and may keep moving higher.
 
TWTR is ranked 6th of 24 stocks in the Growth Portfolio Power Rankings. I added it to the Aggressive Growth Portfolio after it reported last qtr and it ranks 5th of 12 stocks in the Power Rankings.

Aggressive Growth Portfolio

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