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“Could the Trump Effect Prevent Twitter from Plummeting to all-time Low?”
Jordan Hiscott, Chief Trader, at ayondo markets
“With Twitter set to release its Q1 results before the opening bell tomorrow, pressure is building on the company to perform at a time when its industry peers are either on or near all-time highs in share valuation. Twitter’s current price is just $1 off the all-time low of $13.72, and down 70% from the March 2015 high of $50.
“Last quarter, the company reported a loss of $167 million and the dual negative effect of this cash burn rate and a fall in advertising revenue is becoming a serious problem for the embattled social media giant, clearly being reflected in its share price performance.
“In my view, the one surprise upside for Twitter could be the current ‘Trump effect’, with the US President regularly using the platform as his favoured medium to address policy, both domestic and international. The potential of this to increase user numbers could give the firm a financial boost and halt the current monthly cash burn, potentially turning its fortunes around.”
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