SAN FRANCISCO (Reuters) – Twitter Inc shares slipped on Monday after some of the five lead underwriters of its initial public offering said the social media firm may not achieve Facebook-like scale and its stock may not rise much higher.
In their first research reports since the November IPO, only Deutsche Bank and Goldman Sachs recommended buying the stock. Morgan Stanley and JP Morgan issued the equivalent of “hold” ratings. One analyst, Justin Post of Bank of America Merrill Lynch, initiated coverage with a sell rating and valued shares at $36, according to theflyonthewall.com.
Twitter shares dipped 1.3 percent to $41 on Monday. After an explosive debut on November 7, when shares closed more than 70 percent above the $26 IPO price, Twitter has churned for weeks in the low $40s.
At $41, the San Francisco-based company still trades at roughly 20 times estimated 2014 revenues, a multiple that dwarfs that of social media peers like Facebook Inc and LinkedIn Corp at roughly 11 and 17.6 times, respectively.
Read also:
Twitter's Underwriters Project Limited Share Gains (Bloomberg)
Analysts at Twitter's IPO Banks Strike Sober Tone on Stock (Yahoo Finance (blog))
Twitter Feels a Chill After Hot Debut (Wall Street Journal)
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