Twitter stock is currently priced at $17.65 per share, down 1.51%, or $-0.27 in the pre-market trading session. The stock ended the day on Tuesday, 20 December 2016 at $17.92 per share, down 1.75%. Based on its current price, the company has a market capitalization of $12.71 billion and a price/earnings ratio of -20.76. There is no dividend or yield to speak of, and the 1-year target estimate price is substantially lower than the prevailing price, at $17.02 per share. If we turn our attention to the 52-week trading range of the stock, an inflated high of $25.25 was recorded, and the 52-week low is $13.73. The 5-day trading range of the stock is strongly bearish, with mounting losses of 6.71%+. However, the performance of Twitter is surprising given that the quarterly earnings figures have bested estimates by a long margin since Q4 2015.

Below is a chart of the earnings surprise history of Twitter:

We can infer several important performance criteria from the above chart, namely that the consensus forecasts have consistently undershot the actual earnings-per-share figures. While Twitter’s EPS has been negative since December 2015, analysts were expecting substantially worse figures. For the fiscal quarter ending in March 2016, Twitter stock generated a 46.15% earnings surprise. This was followed by a 26.67% earnings surprise for the fiscal quarter ending in June 2016, and a 33.33% earnings surprise in September 2016. For Q4 2016 (the current quarter), the consensus forecast is $-0.12. The financials paint a picture of increasing revenues between 2013 and 2015 (from $664.89 million to $2.22 billion), but it’s the earnings that are the problem. In 2013, Twitter generated earnings of $-645.32 million, followed by earnings of $-577.82 million in 2014, and $-521.03 million in 2015. That the earnings have been consistently negative is a problem for shareholders, and this is driving down Twitter’s stock price.

Twitter Stock Swoops Down Before the Christmas Holidays

Like other major tech stocks, Twitter is subject to wild fluctuations. The recommendation rating among analysts is decidedly bearish, with a consensus rating of hold/underperform awarded to the stock. On a scale of 1.0 (strong buy) to 5.0 (sell), Twitter is rated at 3.1. In the technical performance chart listed above, Twitter can be seen breaching its 50-day moving average of $17.54 per share. This is an extremely bearish signal for the stock, and one that is likely to generate concern among traders. The 5 most important technical indicators for Twitter Inc. indicate some negative trends that will affect the way day traders approach the stock:

• The moving average convergence divergence compared to the 9-day exponential moving average signal line is bearish.
• Twitter stock closed below the 50-day moving average in a bearish move.
• With respect to the relative strength index (RSI) with readings <30 and >70, Twitter offers fair value.
• Twitter is bullish when we look at the stock’s closing price vis-à-vis the 200-day moving average.
• Twitter is bullish when we look at the performance of the 50-day moving average vis-à-vis the 200-day moving average.

Twitter’s performance over the past 12 months is below the performance levels of its peers. All in all, the stock has depreciated by 22.05% this year, but it’s 30-day performance trend indicates that it is neck and neck with its peers. This is a positive sign, and should be factored into the buy/sell decision-making processes of day traders. In terms of its share price performance, Twitter falls into the lagging category, but it is bordering the rising category of stocks. Other stocks that are positioned better than Twitter include Facebook, Microsoft, Google and Meet.