Twitter stock looking good: flat after earnings miss, as social rivals tank
Andrew Burton/Getty Images News

Twitter (NYSE:TWTR) is holding up relatively well Friday, flat at $39.52 and dodging Internet rivals' much heavier stock declines even after its second-quarter report missed Street expectations, as investor focus inevitably remained on its high-profile billionaire battle.
Key earnings numbers typically have less of an effect on stocks when the company involved is in the middle of trying to close a deal for its acquisition, as Twitter is with its $44B agreement to be acquired by multibillionaire Elon Musk. But that applies doubly to Twitter, whose stock at $39.52 currently comes at a 27% discount to Musk's $54.20 per share deal price.
And the Musk drama was present in analysts' minds even as the largely Neutral-feeling group tried to focus on key performance metrics. The Musk issue is a "major source of distraction for management, employees and marketers," Truist Securities said, noting a Hold rating and a $43 price target implying 9% upside.
Even with below-consensus financials, engagement on the platform looks healthy, the firm said. But it comes back to Musk: If the deal breaks down, Truist's base case would put the stock down to the high $20 range from its current $40 level.
MKM Partners also acknowledged the Musk drama but also gave some attention to the much-discussed ad recession - and combined with an awful Snap (NYSE:SNAP) report, it points to "rapid deceleration in online ad market demand trends." The firm is also Neutral on Twitter (TWTR).
And Neutral Baird said Twitter revenues that slipped 1% weren't surprising amid the "well-documented deceleration" in broader spending; it has a $33 price target, implying 16% downside.
Meanwhile, Twitter's modest stock reaction could be seen as a victory after weak results from Snap (SNAP) are again weighing on ad-exposed social media names. Snap (SNAP) has hit the $10 mark, down 38.8% from Thursday, and Meta Platforms (NASDAQ:META) is taking the brunt among key rivals, down 7.4%. Google is sharply lower as well: (NASDAQ:GOOG) -5.6%; (GOOGL) -5.6%.
Pinterest (PINS) - which tends to catch a bad cold when social-media rivals sneeze - is down a hefty 14.1% Friday.