Yesterday, jaws dropped as Twitter’s stock hit new heights, as we wrote here. But on Friday, Twitter lost steam on the New York Stock Exchange after Macquarie Capital downgraded the stock.
As reported by Bloomberg, Macquarie analyst Ben Schachter downgraded Twitter to “underperform,” down from “neutral,” and said the stock had gone “too far, too fast.” He expects other analysts to follow suit in coming weeks, he said.
By midday Friday, Twitter shares were down more than 7 percent to $67.63. The stock had touched $75 on Thursday, nearly triple its IPO price of $26, before closing at $73.31. That still puts the unprofitable company’s market cap in the stratosphere of other valuable U.S. firms and made it larger than Time Warner or Target.
As the Mercury News’ Peter Delevett points out, even some of the underwriters who took Twitter public are holding back at prices above $50.
Ian Winer, director of equity trading at Wedbush Securities told the Wall Street Journal that Twitter’s popularity signals the return of the retail investor, who can be fickle:
In a name like Twitter, the retail investor is finally starting to come back…For the first time in a long time, I’ve seen retail investors really starting to act differently.
Above: Twitter icon on an iPhone. (Laura A. Oda/Bay Area News Group)