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New Jefferies internet analyst Brent Thill downgrades Twitter rating to ‘hold’ in bumper sector review

Thill, who joined Jefferies in May having previously worked for UBS, believes that Twitter's users are engaging more with its platform but that the social media company is having difficulty translating that into revenue, and finding growth.

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The internet analyst and his team think that Facebook Inc will be a "clear winner" in social media

New Jefferies International internet analyst Brent Thill has downgraded the broker’s rating on Twitter Inc (NYSE:TWTR)  to ‘hold’ from ‘buy’ as part of a 200-plus page note on sector.

Thill, who joined Jefferies in May having previously worked for UBS, believes that Twitter's users are engaging more with its platform but that the social media company is having difficulty translating that into revenue, and finding growth.

READ: Twitter battered as user growth stalls

The internet analyst and his team think that Facebook Inc (NASDAQ:FB)  will be a "clear winner" in social media.

READ: Facebook Iaunches "Watch" for original video content

They also believe Twitter will lag behind other advertising plays such as Alphabet Inc.'s (NASDAQ:GOOGL) Google unit and Snap Inc.(NYSE:SNAP) , especially when it comes to digital video.

Thill concluded that video is "the largest opportunity across social for 2018 to 2020" and Twitter's product is not really different.

READ: Google parent Alphabet posts quarterly profit decline after record EU antitrust fine

In pre-market trading, Twitter shares were down 1.4% at US$16.66. Jefferies price target for Twitter is US$16, down from US$20.

Among other changes in the bumper sector review, Thill and his team also downgraded Tripadvisor Inc (NASDAQ:TRIP), Endurance International Holdings Group Inc (NASDAQ:EIGI), and Shutterstock Inc (NYSE:SSTK) all to ‘underperform’, but upgraded Expedia Inc (NASDAQ:EXPE) to ‘buy’.

Quick facts: Twitter Inc

Price: 38.99 USD

NYSE:TWTR
Market: NYSE
Market Cap: $30.14 billion
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