What to Expect From Twitter Earnings

Twitter Inc. (NYSE: TWTR) is set to report its first-quarter financial results after the markets close on Tuesday. The Thomson Reuters consensus estimates call for $0.10 in earnings per share (EPS) on revenue of $607.84 million. In the same period of the previous year, the social media company posted EPS of $0.07 and $435.94 million in revenue.

This company maintained its position as one of America’s most visited sites, even as it struggles to gain revenue continue. Its site had 114 million visitors in March. The data come from online research firm comScore, which releases information about visits to sites as a measure of U.S. internet activity. It covers both desktop and mobile audiences.

Twitter placed 15th on the comScore list, compared with second-place Facebook, which had visits of 207.4 million, and LinkedIn at number 12 with 122.7 million. Each of these companies has a large revenue base that shows the extent to which it has capitalized on its size. Twitter is famous as a firm that cannot match that transition.

Last year, Twitter’s revenue was $774 million, compared to $547 million in the year before. While the growth rate was impressive, the relative size of the revenue was not, compared to the other largest social networks. And investors sold off the stock, in large part because Twitter’s guidance for first-quarter revenue was modest.
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A few analysts weighed in on Twitter prior to the release of its earnings report:

• Canaccord Genuity reiterated a Buy rating.
• RBC Capital reiterated a Hold rating.
• Robert Baird reiterated a Neutral rating with an $18 price target.
• Pacific Crest reiterated a Sector Perform rating.
• Wedbush reiterated a Hold rating with a $20 price target.

So far in 2016, Twitter has underperformed the broad markets, with the stock down 26%. Over the past 52 weeks, the stock is down 66%.

Shares of Twitter were trading up 3.8% at $17.75 Tuesday afternoon, with a consensus analyst price target of $21.03 and a 52-week trading range of $13.91 to $52.22.