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Published: April 8, 2020 at 11:07 a.m. ET, By Emily Bary<\/p>\n
Twitter Inc.\u2019s position \u201cat the fulcrum of news and conversation during this unprecedented global event\u201d prompted one formerly bearish analyst to take a slightly rosier view of the stock Wednesday.<\/p>\n
Bernstein\u2019s Mark Shmulik upgraded the shares to market perform from underperform<\/a> in a note to clients, writing that while Twitter TWTR faces some headwinds related to the COVID-19 outbreak, including the postponement of many live events that drive marketing spending, these challenges are priced into the company\u2019s stock.<\/p>\n \u201cWhile the full extent of the COVID fallout is hard to gauge, near-term headwinds are at least partially known following the company\u2019s withdrawal of [first-quarter] guidance and the stock is among the hardest hit in our coverage since the drawdown started (-33% versus Facebook FB -22% for example),\u201d he wrote.<\/p>\n Though there are some near-term challenges, Shmulik is comforted by the fact that many big events have merely been postponed, not lost forever. And he thinks Elliott Management Corp. and Silver Lake\u2019s involvement with the company \u201cshould accelerate [the] pace of change\u201d as far as product improvements.<\/p>\n Shmulik also pointed to the company\u2019s disclosure of a recent uptick in user engagement<\/a> during the COVID-19 outbreak, though he warned investors not to get too excited.<\/p>\n \u201cWe caution about placing too much stock into engagement as (1) everyone has seen a spike in engagement (2) unclear what happens to engagement levels post-COVID, and (3) it\u2019s valueless if you can\u2019t monetize,\u201d he wrote.<\/p>\n