Investors who have owned stocks in the last year have generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE:SPY) total return over the last 12 months is 47.6%. But there is no question some big-name stocks performed better than others along the way.
Twitter’s Run: One company that has been a great investment in the last year has been social media giant Twitter Inc (NYSE:TWTR).
The COVID-19 pandemic in 2020 was actually very good for Twitter’s business. While other companies were dealing with economic shutdowns, people around the world who were sheltering in place had little to do for entertainment and social interactions other than social media.
In 2019 Twitter reported $1.87 in EPS on $3.45 billion in revenue. In 2020, EPS swung to a loss of 87 cents, but revenue grew to $3.71 billion.
The 2020 U.S. presidential campaign and election also helped improve Twitter’s engagement, but Twitter made the controversial decision to ban former President Donald Trump from its platform in January 2021.
At the beginning of 2020, Twitter shares were trading at $32.31. By the beginning of March, the stock was up to $36 despite news of the coronavirus spreading in China prompting concerns about a U.S. pandemic.
Twitter bottomed at $20 during the pandemic-driven March sell-off. Fortunately for Twitter investors, the dip did not last long.
By the end of July, Twitter shares were back at new 52-week highs above $40, and the stock got as high as $52.93 in October prior to the U.S. elections.
Related Link: If You Invested $1,000 In Facebook Stock One Year Ago, Here’s How Much You’d Have Now
Twitter In 2021, Beyond: Twitter ultimately made it to a new all-time high of $80.75 in February 2021, but the stock took a big hit following its most recent earnings report in late April. The stock tanked after management guided for second-quarter revenue to be flat compared to the first quarter.
Looking ahead into the next several quarters, Twitter is facing several potential headwinds.
Traders may continue taking profits in the stock after a big run since the start of 2020. They may also be concerned about regulatory crackdowns on big tech stocks, particularly concerning social media data collection and content moderation. Twitter also continues to lag its social media peers in monetizing its user base, although it is experimenting with features such as Super Follows, tipping and Twitter Communities.
In addition, some sellers may simply see 2020 pandemic comps setting Twitter up for some lackluster growth numbers in coming quarters.
Still, Twitter investors who bought one year ago and held on have generated a nice return on their investment. In fact, $1,000 in Twitter stock bought on May 6, 2020, would be worth about $1,908 today.
Looking ahead, analysts are expecting more upside for Twitter in the next 12 months. The average price target among the 35 analysts covering the stock is $66, suggesting 25% upside from current levels.
