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Twitter bottoms S&P 500 as traders fear users activity may slow

Stock dropped as much 8.2% on Monday in wake of account suspensions

Gulf News

New York: Twitter Inc’s stock is trending, and it’s not up for sure.

Traders fear that Twitter Inc’s decision to suspend more than one million fake accounts per day will haunt the social platform’s number of monthly active users, sending the stock down as much 8.2 per cent Monday as of 10.44am.

The share drop follows Friday’s post-market when the Washington Post that said the company’s rate of account suspensions has more than doubled since October 2017.

The “volume of fake account deletion, albeit good for longer term, raises uncertainty on near-term user growth expectations,” wrote Bloomberg Intelligence analyst Jitendra Waral.

But Twitter Inc’s stock is still up 83 per cent year-to-date, and Waray believes the “risk to daily user growth should be low as the company has underscored low activity on the deleted accounts.”

Twitter Inc rose 6.8 per cent last week, coinciding with a positive note from Wells Fargo analyst Peter Stabler, touting the company’s success with video content and improved monetisation efficiency. The social platform’s “high valuation is expecting continued momentum in user growth and engagement that they have seen over the past several quarters,” Waral said.

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