- Twitter (TWTR) stock traders are, understandably, obsessing over whether the company will go from publicly held to private.
- However, informed investors shouldn’t bury the real headline, which concerns Twitter’s daily active usage increase.
- Thus, investors should consider holding their Twitter shares while they’re still publicly traded.
There are a lot of shortages in the world right now, but there’s no shortage of controversy surrounding Twitter (NYSE:TWTR). Investors might feel nervous about holding onto TWTR stock, but there’s no need to panic-sell your shares.
Overall, the nervousness is really just a by-product of uncertainty. After all, if financial market traders hate anything, it’s uncertainty; But that’s just a part of long-term investing.
Nonetheless, it’s important to be aware of the buzz and the hubbub surrounding Twitter now. At the same time, though, you can do what sensible investors always do: let the hard data inform your financial decisions.
What’s Happening with TWTR Stock?
“I consider the Musk/Twitter episode a sideshow to serious investing. It’s interesting to watch, and will be fascinating to see the outcome but I’m not letting it distract me from looking for good opportunities.”
That’s a quote from analyst Peter Tuz. And it’s a bold statement during a time when the markets are debating whether Elon Musk will actually buy out Twitter and take it private.
The situation involving Musk and Twitter might not exactly be a “sideshow,” but we don’t have to allow it to dominate our thoughts. In fact, I’ll move on to some data points that current and prospective TWTR stock investors should focus on shortly.
Still, though, it’s good to be aware of the latest developments in the Musk-Twitter soap opera. As you may be aware, Twitter announced on April 25 that the company had agreed to be bought out by Musk for $54.20 per share in cash. Furthermore, upon completion of this transaction, Twitter would become a privately held company.
However, the next thing you know, on May 13, Musk suddenly announced/tweeted, “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.” So, the official decision involving Musk and Twitter is still up in the air.
Sticking to What We Know
Musk is known for attention-grabbing antics, so perhaps Tuz’s “sideshow” comment has some merit to it. In any case, there’s no way to predict the future course of the Musk-Twitter negotiations. Therefore, we can instead look at some established facts.
One established fact is that Twitter generated first-quarter 2022 revenue of $1.2 billion. That’s impressive, as it represents an increase of 16% year-over-year (YOY).
Diving further into the details, Twitter’s advertising segment revenue totaled $1.11 billion, up 23% YOY. Hopefully, Twitter can continue this positive trend in future quarters.
Here’s where the rubber really meets the road, though. In Q1 2022, Twitter’ average monetizable daily active usage was 229 million — representing an improvement of 15.9% YOY.
With that in mind, some folks might contend that daily active usage is among the most important metrics for social media platforms. After all, the users are the lifeblood of Twitter’s business model. And if they’re not active, then there’s no business to speak of.
What You Can Do Now
Collectively, there’s nothing inherently wrong with following the Musk-Twitter drama. It’s more than a “sideshow,” but you don’t have to allow it to dissuade you from owning TWTR stock.
How will the drama resolve itself? Only time will tell. In the meantime, though, Twitter is still a publicly-traded company with positive data to bolster a convincing bullish thesis. So, don’t be afraid to buy or hold Twitter shares while awaiting the outcome of the ongoing acquisition drama.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.