Twitter shares pop after Bank of America says younger demo using service, upgrades stock
Summary
Twitter shares jumped on Thursday after Bank of America Merrill Lynch upgrade the stock, citing increased usage by younger people and more engagement by its current users. Bank of America raised the stock to buy from neutral and took the firms price target to $39 from $31. "Churn remains elevated, but improving metrics in the 18-29 demographic suggest more younger users are turning to Twitter," stated the Thursday note to clients, which cited a social media user survey by the firm. "While Twitter has significantly less time spent per user than Facebook, monetization is also significantly lower than the $25 ARPU Facebook will generate globally in 2018, and $108 in the U.S.," the note said. "If Twitter can continue to improve engagement and targeting and build out its direct response advertiser base, comps suggest opportunities for significant ARPU increases.