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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Twitter, Inc. (XNYS:TWTR) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
TWTR
Name:
TWITTER, INC. (XNYS:TWTR)
Sector:
- 37083.00K
Industry:
Internet Content & Information
CEO:
Mr. Jack Dorsey
Total Employees:
7,500
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -43.79% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF TWITTER, INC.(TWTR) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INTERNET CONTENT & INFORMATION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
38.63
One Month Price Target:
$38.77
Six Month Price Target :
$39.48
Likely Price in One Year's Time:
Ticker:
$40.33
Likely Trading Range Today Under (Normal Volatility)
$38.44
Price Upper limit ($) :
$38.89
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$35.93
This week:
$32.6
This month :
$26.56
Other Primary facts
Market Cap:
29.64B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
765.25M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
27.12%
-21.11%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$51.15
$45.38
$26.11
$31.88
Medium risk (<10%) entry points
Buy Call
Sell Call
$43.50
Buy Put:
Sell Put:
$42.26
$33.75
$35.00
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
TWTR
Sharpe Ratio:
2.46%
Comparison:
TWTR, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 7762.42% higher than the industry
& ratio is 7.89% higher than the market/S&P 500 average
Average Returns/Yield of
TWTR
Daily returns:
0.09%
Weekly returns:
0.47%
Monthly returns:
1.87%
Yearly returns:
0.13%
Comparison of returns:
Average annual returns/yield (last 3 years) is 16615.51% above industry average
Classification:
TWTR, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.94
Statistical test of Returns:
TWTR has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.45%
Weekly Volatility:
7.71%
Monthly Volatility:
15.42%
Yearly Volatility:
53.40%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.87%
Volatility in last five trading days has been -74.68% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.99%
Weekly VaR:
-15.62%
Monthly VaR:
-31.24%
How Much Can the price of
TWTR
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-27%
Worst case (decline):
>85%
This translates to price declining to:
$28.37
This translates to price declining to:
$5.79
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
TWTR is a 120.49% riskier investment compared to the market/S&P 500 & is 88.90% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -15.84% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
TWTR
Beta in relation to market/S&P 500--0.65
Expected beta in 1 year's time:
0.632
Expected beta in 3 year's time:
0.893
Unlevered (debt free) Beta:
0.393
Beta in relation to Nasdaq (XNAS):
1.057
Beta in relation to all global stocks::
0.851
Beta Comparison & Analysis
Beta of competitors/peers::
0.93
Beta is -29.81% lower than peers
Average Industry Beta:
1.399
Beta is -53.31% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.148
Alpha is -217.84% below industry average alpha yield
Alpha is 945% higher than market/& is unsustainably high
Analysis of Cost of Capital of
TWTR
Equity cost of capital:
0.076
Equity cost of capital is -40.12% below industry mean WACC
Unlevered (without debt) cost of capital:
4.59%
Before-tax cost of debt:
0.81%
After-tax cost of debt:
0.64%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.64%
WACC is -59.87% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$6.85
Revenue growth rate per share of (3Y):
5.01
Annual revenue growth rate is -64.63% below industry average
EPS:
$0.24
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
-
-
-
Debt per share
$8.39
EBITDA per share
$1.30
Valuation Analysis Today of
TWTR
P/E Ratio:
163.24
P/E Ratio of Competitors/Peers:
50.57
P/E ratio is 222.77% higher than main peers & is 330.42% higher than the industry
Stock price/value with industry average P/E ratio: $9.10
TWTR is 324.41% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
5.64
Price to sales ratio is 10.45% above the industry mean
P/B (Price to book value ratio):
5.01
-
-
Net income growth rate (3Y):
-117.58%
Net income growth rate is 48.66% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
108.69%
Net debt to equity ratio:
73.55%
Debt to assets ratio:
47.36%
Net debt to assets ratio:
32.05%
Debt-to-asset ratio is 8.52% above industry average
Ability to repay debt:
Interest coverage ratio:
18.62
Interest coverage ratio is 54.04% more than industry average
Looking forward:
Debt growth rate:
23.69%
Annual debt growth is -94% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.512
Statistical significance of correlation:
TWTR has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.473
Stock price is 8.16% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.473
Correlation of price movement with Nasdaq (^IXIC):
-0.018
Covariance of price movement with the market:
-0.036
Kurtosis
9.918
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.174
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
TWTR
Gross Profit Margin Ratio:
252%
Operating Profit Margin Ratio:
-12.83%
Operating profit margin is -2373.34% lower than the industry
Net Profit Margin Ratio:
252%
Effective Tax Rate:
39.09%
Effective tax rate is 204.09% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
3.79%
Return on equity (ROE) is -143.91% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.65%
Return on assets (ROA) is 6.34% higher than the industry
Financial Leverage:
1.9x
Current Ratio:
6.58
Current ratio is 83.73% above industry average
Cash Conversion Cycle (days):
46.3
Cash conversion cycle is -31.59% below industry average
The remaining useful life of property plant & equipment is: 0.0 years
Stock based compensation to net income ratio:
79.18%
In-depth Efficiency Analysis
Revenue generated per employee:
699.0K
Each employee generates -22% less revenue than industry average revenue per employee
EBITDA generated per employee:
132.7K
Each employee generates 27% more EBITDA than industry average revenue per employee
Profit generated per employee:
29.8K
Each employee generates -33% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 4.9K
Each employee generates -105% less free cash flow than industry average revenue per employee
Assets/Capital per employee
810.0K
Each employee generates -105% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 42.81%
Growth rate in R&D investment/expenditure is -827.69% lower than the industry
Competitors/Peer firms of
TWTR
TELUS Corporation (XNYS:TU)
Chunghwa Telecom Co., Ltd. (XNYS:CHT)
PT Telkom Indonesia (Persero) Tbk (XNYS:TLK)
LIVE NATION ENTERTAINMENT, INC. (XNYS:LYV)
Telefonica SA (XNYS:TEF)
Rogers Communications Inc. (XNYS:RCI)
TWILIO INC. (XNYS:TWLO)
PINTEREST, INC. (XNYS:PINS)
Spotify Technology SA (XNYS:SPOT)
Current Analyst Ratings
Strong buy�8%
Buy�8%
Hold�88%
Sell�42%
Strong sell�4%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
5.24B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.92B
3.32B
1.37B
616.67M
1.86B
1.24B
-
3.23B
32.64M
53.45M
574.08M
995.06M
- 672754.00K
223.87M
367.54M
143.66M
223.87M
Statement of Cash Flow
Date:
Period:
160.28M
Differed Income Tax :
190.71M
Stock Based Compensation :
177.26M
Change in Working Capital :
49.74M
Accounts Receivables:
190.74M
Other Working Capital:
-
Other Non-Cash Items:
- 965191.00K
Net Cash Provided by Operating Activities:
126.09M
Investments in PP&E:
- 163174.00K
Net Acquisitions:
-
Purchases of Investments:
- 1112351.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
2.28B
3.98B
6.26B
948.14M
-
265.97M
7.48B
3.42B
1.30B
59.73M
-
941.88M
351.80M
6.07B
-
13.55B
189.52M
208.41M
54.29M
64.40M
674.37M
1.14B
6.42B
50.05M
6.51B
-
7.65B
4.00K
- 616860.00K
- 155522.0K
6.68B
March 31, 2022 at 6:00:00 AM
5.15B
5.90B
13.55B
-
6.63B
4.3B
1.29B
1.05B
1.06B
-
-
- 2077759.00K
-
984.61M
- 1093153.00K
- 814.00K
97.03M
2.31B
2.21B
126.09M
- 163174.00K
- 37083.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
TWTR
2023
2024
2025
2026
2027
$38.03
$39.70
$41.45
$43.27
$45.16