Truist Securities Analyst Youssef Squali downgraded Twitter, (NYSE:), to Hold from Purchase with a $50.00 share price target.

Squali points out that Twitter’s stock price is near his target price as Twitter awaits an Elon Musk hostile offer.

Tesla (NASDAQ:) CEO’s $54.20 per share offer is seen as “fair” while Squali says that “a competing bid is unlikely given 1) how restricted the “strategics” like GOOGL/MSFT are in M&A, 2) size of investment (at $43B+), and 3) valuation.”

The analyst added that Twitter stock price could “revert to the low-to-mid $30s” if Musk’s offer fails to materialize. Shares would plummet by 35% if they were to move up to $30, compared with current levels.

The analyst also expects Twitter will report Q1 results in line with expectations.

“We note however that both F/X and the Russia/Ukraine war are short-term headwinds.. 1Q22 is a tough comp period with the company lapping 1Q21’s 28% growth. Given Twitter’s heavier skew towards brand advertising, we see the company as somewhat insulated from Apple’s iOS14.5 changes on measurement and targeting,” Squali wrote in a client note.

Twitter shares are down almost 1% today

By Senad Karaahmetovic