Twitter Stock Dips Amid Podcast App Acquisition

Financial aspects of the deal have not yet been disclosed

Deputy Editor
Jan 5, 2021 at 11:00 AM
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The shares of Twitter Inc (NYSE:TWTR) are down 0.4% to trade at $54.32 at last check, after news that the social media company is acquiring podcast app Breaker. The financial aspects of the deal have not been disclosed, though Breaker announced users can now transfer their subscriptions to other apps such as Apple (AAPL) and Spotify (SPOT). To follow, Morgan Stanley raised its price target on TWTR to $50 from $42. 

Twitter stock has recently taken a mild breather on the charts, after rallying to a Dec. 16 six-year high of $56.10. However, today's pullback seems like it has been captured by the 20-day moving average. Longer term, TWTR still sports a roughly 71% year-over-year lead. 

A fresh round upgrades and/or price-target hikes could act as tailwinds for the security moving forward, as 16 of the 23 in coverage call TWTR a tepid "hold." Plus, the stock's 12-month consensus price target of $44.69 is a 17.7% discount to its current perch.

In the same vein, options traders are looking more bearish than usual. Twitter stock's 10-day put/call ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) stands higher than 88% of all other readings from the past year. This means that puts have been picked up at a faster-than-usual clip in the past two weeks.

Now looks like a good time to weigh in on TWTR options as well. The stock's Schaeffer's Volatility Index (SVI) of 46% stands higher than 18% of all other readings in its annual range, implying that options players are pricing in relatively low volatility expectations at the moment. 


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