Twitter Inc (NYSE:TWTR) announced that Dick Costolo has decided to step down as Chief Executive Officer of Twitter, effective July 1, 2015. Twitter’s Board of Directors has named Jack Dorsey, Co-Founder and Chairman of the Board, to serve as Interim CEO while the Board conducts a search for Twitter’s next CEO. Costolo will continue to serve on Twitter’s Board of Directors, and Dorsey will continue to serve as CEO of Square, Inc., the payments and financial services company he co-founded in 2009.
Twitter’s Board has formed a Search Committee to lead the search for a permanent CEO. The Search Committee is chaired by the Board’s Lead Independent Director, Peter Currie, and includes Peter Fenton and Evan Williams. The Committee will retain a leading executive search firm to assist in conducting a global search, which will consider both internal and external candidates for the CEO position.
Costolo said, “I am tremendously proud of the Twitter team and all that the team has accomplished together during my six years with the Company. We have great leaders who work well together and a clear strategy that informs our objectives and priorities. There is no one better than Jack Dorsey to lead Twitter during this transition. He has a profound understanding of the product and Twitter’s mission in the world as well as a great relationship with Twitter’s leadership team. I am deeply appreciative of the confidence the Board, the management team and the employees have placed in me over the years, and I look forward to supporting Twitter however I can going forward.”
Dorsey said, “The future belongs to Twitter thanks in large part to Dick Costolo’s dedication and vision. Dick has put a world-class team in place and created a great foundation from which Twitter can continue to change the world and grow. We have an exciting lineup of products and initiatives coming to market, and I look forward to continuing to execute our strategy while helping facilitate a smooth transition as the Board conducts its search.”
Dorsey continued, “I am grateful for the talented team at Square, which I will continue to lead. We have built a very strong company from top to bottom, and I am as committed as ever to its continued success.”
Currie said, “On behalf of the Board, I want to thank Dick for his years of tireless devotion to building Twitter into the strong and dynamic company it is today, putting us in a superb position for continued growth and innovation for many years to come. We look forward to his continued contributions during the transition period and as an ongoing member of the Board. The Board is fully committed to running a thorough process to identify the right CEO to lead Twitter into its next phase of growth. In the meantime, we are fortunate to have Jack – one of our founders – step back into a management role and help lead Twitter as we continue executing on our strategic priorities.”
Second Quarter 2015 Outlook
Twitter also today reaffirmed its outlook for the second quarter of 2015. The Company continues to expect revenue to be in the range of $470 million to $485 million and adjusted EBITDA to be in the range of $97 million to $102 million. Stock-based compensation expense is expected to be in the range of $190 million to $200 million, excluding the impact of equity awards that may be granted in connection with potential future acquisitions. (Original Source)
Shares of Twitter are trading up 7.67% in after market trading. TWTR has a 1-year high of $55.99 and a 1-year low of $34.62. The stock’s 50-day moving average is $38.89 and its 200-day moving average is $42.41.
On the ratings front, Twitter has been the subject of a number of recent research reports. In a report issued on June 5, Axiom analyst Victor Anthony maintained a Hold rating on TWTR, with a price target of $45, which represents a potential upside of 25.3% from where the stock is currently trading. Separately, on June 4, Evercore ISI’s Ken Sena downgraded the stock to Hold and has a price target of $39.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Victor Anthony and Ken Sena have a total average return of 16.4% and 5.7% respectively. Anthony has a success rate of 66.4% and is ranked #90 out of 3621 analysts, while Sena has a success rate of 52.2% and is ranked #984.
Overall, 14 research analysts have assigned a Hold rating and 12 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $47.08 which is 31.1% above where the stock opened today.
Twitter Inc is a platform for public self-expression and conversation in real time. It provides a way for people to stay informed about their interests, discover what is happening in their world and interact directly.