With earnings season in full swing, analysts from Cantor and FBR & Co. are eager to weigh in on social media giant Twitter Inc (NYSE:TWTR) and Tableau Software Inc (NYSE:DATA) pre and post earnings, respectively. While one analyst remains bullish on Twitter, citing several product advantages and positive metrics, the other remains on the neutral on Tableau after the company posted lower than expected guidance.
Prior to its much anticipated Q4 earnings release, Cantor analyst Youssef Squali offers his commentary on Twitter. Squali predicts the company will post ad revenue growth for the quarter, although all eyes will be on user growth, which is expected to decline for the first time since the company’s IPO. Additional metrics the analyst will be watching for include “the net impact from the launch of new products/tweaks like Moments,” and the company’s strategic direction following the recent departure of four key executives.
Despite some uncertainty regarding earnings and user growth, the analyst remains bullish due to “the company’s differentiated offering, mass audience, attractive revenue growth profile and potential for a take-out.”
The analyst reiterated his Buy rating on the company with a $45 price target. Yousef Squali is ranked #54 out of 3,681 analysts on TipRanks. He has a 54% success rate recommending stocks with an average return of 10.1% per recommendation.
According to TipRanks’ statistics, out of the 19 analysts who have rated the company in the past 3 months, 9 gave a Buy rating, 3 gave a Sell rating, and 7 remain on the sidelines. The average 12-month price target for the stock is $26.94, marking a 78% increase from where shares last closed.
Tableau Software Inc
Following its Q4 earnings, analyst Daniel Ives of FBR & Co. weighed in on Tableau Software. The company posted guidance that fell below what The Street expected, which the analyst believes is a “major ‘gut punch’ to the bulls.” The analyst specifically points to lower than expected licensing revenues for the quarter, which are typically strong, representing a “tough pill to swallow for investors” as the company usually beats Street expectations. These factors in combination with “multiple compression, heavier investments (international expansion), and a softer growth trajectory on the horizon” will make investors head for the hills. The analyst also comments on the “softness on large deals” and “caution from the core customer base heading into 2016,” which according to Ives indicates a rough IT environment.
However, Ives states that it is not all bad for Tableau, highlighting customer and order growth as well as “better than expected top line and operating margin.” He believes the big data industry is poised for growth in the long term, although this earnings miss will “put a dent” in the company for the near-term. Ives predicts future growth, although acknowledges the “painful transition from hyper growth to a more normalized growth path” for the company.
On February 4, 2016, the analyst maintained his Market Perform rating on the company with a $115 price target. Daniel Ives has a 39% success rate recommending stocks with an average loss of (4.2%) per recommendation.
According to TipRanks’ statistics, out of the 14 analysts who have rated the company in the past 3 months, 6 gave a Buy rating, 1 gave a Sell rating, and 7 remain on the sidelines. The average 12-month price target for the stock is $67.64, marking a 74% increase from where shares last closed.