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+--- Thread: Is twitter a momentum play now? (/thread-104662.html)
Is twitter a momentum play now? - global imrc - 02-24-2014 11:30 PM
Twitter is cash flow negative, they still haven't turned a profit, the $43 current trading price is absurd. However, currently analysts rating this stock a buy now = 8 buy, 8 hold, 2 sell. Last month was 4 buy, 1 hold, 0 sell. Why are analysts giving this stock a buy? Are they expecting earnings to grow strongly within the next few quarters or is it more out of self interest on their part? I think Twitter is a sell/short. Since Twitter is moving up while the market is moving down now, is twitter a pure momentum play until as always valuation finally kicks into people's minds and they start selling in droves?
- underexposed... - 02-24-2014 11:38 PM
this is hardly a momentum play...one day's action does not establish a direction....the stock has basically flatlined...also it doesn't even have enough data for a momentum indicator such as MACD to even show up
http://stockcharts.com/h-sc/ui?s=TWTR&p=D&yr=0&mn=3&dy=0&id=p79552168798
A momentum play would be characterized by either a sharply defined rise or fall in price combined with increasing volume. You don't have any of that here. The ratings of analysts (for what they are worth) have not changed much...there are just more of them offering an opinion.
While I do agree that the price is too high (for me anyway) for such a new stock with no revenue...but you have not even waited long enough for them to publish their first quarterly report...it is then you will see whether they have any revenues after becoming public.
right now the share price is quite listless trading between $39 - $46...wait until the price breaks this resistance or support before deciding a direction then look for an increased volume to conclude there is momentum behind such a move.