For Twitter (ticker: TWTR), he went to Buy from Hold, with a price target of $56, up from $36. The call is part of a broader bullish report on the social-media stocks, which he thinks are positioned to benefit from a coming rebound in online advertising demand.
The analyst lifted his price targets on Facebook (FB), to $325 from $305; Alphabet, Google’s parent (GOOGL), to $2,020 from $1,975; Pinterest (PINS), to $55 from $43; and Snap (SNAP), to $32 from $28. He repeated Buy ratings on all of them.
“We are bullish on the ad names into Q3 results given a continued ad recovery through Q3 and a strong outlook for Q4 based on our industry conversations,” he said. “We are bullish on the space into 2021, where a continued cyclical recovery and easy comps will drive accelerating growth and margin recovery, with potential for more share gains across online advertising.”
He cited the large-cap companies in the group—Google and Facebook—as having a better balance of risks and potential rewards, given that investors are less enthusiastic about their prospects than they are for the midcap firms in the group: Snap and Pinterest. Walmsley said he is positive about Snap and Pinterest’s fundamentals, but noted “positive sentiment” about those stocks.
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