Shares of Twitter (TWTR) are on the rise after JPMorgan analyst Doug Anmuth upgraded the stock to Overweight, a buy-equivalent rating, as he believes product improvements and user growth should drive revenue inflection. Meanwhile, his peer at Summit Redstone started coverage of the microblogging service stock with a Buy rating, pointing to similar reasons.

BUY TWITTER: In a research note to investors this morning, JPMorgan's Anmuth upgraded Twitter to Overweight from Neutral and raised his price target on the shares to $27 from $20, while calling the stock one of his top small-to-mid-cap ideas in 2018. Anmuth's target of $27 is easily the highest of the 28 Wall Street analysts with price targets updated within the last three months, according to Bloomberg data. The analyst believes both the Twitter story and financial results will strengthen over the next year as the company continues to build on its differentiated value proposition for users and returns to revenue growth. Anmuth argued that the company's products are improving, led by video and live streaming content, changes across the timeline, notifications and Explore tab and a better user interface. Additionally, he expects continued double-digit Daily Active Users growth of 10% in 2018 and believes Twitter can grow ad revenue 8.6% in 2018 on increasing demand. Twitter should be GAAP profitable in 2018 as it benefits from revenue-driven margin expansion, he contended. Meanwhile, Summit Redstone analyst Jonathan Kees started coverage of Twitter with a Buy rating and $26 price target. The analyst told investors in a research note of his own that he sees an opportunity in the shares for 2018 as easier comparisons could lead to revenue growth.

WHAT'S NOTABLE: Twitter is implementing new rules that will suspend users affiliated with hate groups "on and off the platform" in a policy that could result in a purge of alt-right and neo-Nazi accounts, according to Recode, citing the company. Twitter will begin punishing accounts that include "hateful imagery and display names" or those who "use a username, display name, or profile bio to engage in abusive behavior" as the platform looks to combat "specific threats of violence or wish for the serious physical harm, death, or disease of an individual or group of people."

PRICE ACTION: In morning trading, shares of Twitter have gained almost 8% to $23.95.