Twitter trading at lowest price since June after a brutal analyst note

Twitter CEO Jack
Dorsey
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• Twitter shares
  fell to their lowest price in months on Monday after a brutal
  research note from MoffettNathanson.
• “For a business locked in competition with industry
  giants and under siege from regulators, reported operating
  expense growth has been amazingly low,” analyst Michael
  Nathanson said.
• 
  
  Follow Twitter’s stock price in real-time
  here. 
  

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Twitter shares
fell more than 4% to $28.43 on Monday, their lowest price since
April, after MoffettNathanson cut its price target to a Wall
Street low of $21.

The stock is now down more than 40% from its high of $47.79 in
June. 

The social network is struggling with “smoke and mirrors on the
cost line” analyst Michael Nathanson said in a note to
clients, adding that the rest of Wall Street was likely
underestimating Twitter’s growing expenses.

“For a business locked in competition with industry giants and
under siege from regulators, reported operating expense growth
has been amazingly low,” he said, according to CNBC.

“After digging into the most recent 10-Qs, we would argue that
true underlying cost growth has actually been materially higher
in the range of 13 percent to 15 percent.”

In its most recently quarterly earnings report in July, Twitter
said it experienced a
drop in monthly active users, sending shares
down by as much as 18%. Complaints about the social
network’s handling of trolls, bots, and conspiracy
theorists,
like Alex Jones and his InfoWars blog, only weighed
more on the stock’s price through August. These struggles point
to a “dire need to improve platform safety,” Nathanson said.

Despite the slump, Twitter is still up about 18% this year.

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