Micro-blogging site Twitter (NYSE: TWTR) outpaced the market last month by gaining 14.5%, compared to a 2% increase in the S&P 500, according to data provided by S&P Global Market Intelligence.
The rally has contributed to strong recent returns for the stock, which has gained over 70% so far in 2018.
Investors have been feeling more optimistic about Twitter’s growth opportunities lately. Sure, its business isn’t seeing nearly the user gains or the profitability that rival Facebook has managed. However, Twitter announced a healthy 21% spike in revenue in the most recent quarter as it logged its sixth consecutive quarter of double-digit growth in daily active users.
Twitter counted 336 million monthly active users in the first quarter of 2018, up only slightly from 327 million a year ago. CEO Jack Dorsey and his team will need to push that number far higher in order to reach their goals of building a widely relevant content platform.
Advertising revenue will likely rise at a faster pace than users, as the company learns to better monetize the content it showcases, especially video. These positive trends make it likely that Twitter will see its sixth year of improving earnings results as the company continues to aim toward finally achieving GAAP profitability on an annual basis.
10 stocks we like better than Twitter
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now… and Twitter wasn’t one of them! That’s right — they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of June 4, 2018