Nomura Comments On Twitter's 'Search To Fill The CEO Perch'

In a report published Monday, Nomura analyst Anthony DiClemente maintained a Neutral rating on Twitter Inc TWTR, with a price target of $39, following news of the departure of CEO Dick Costolo. Twitter announced the resignation of Dick Costolo as the company's CEO, while naming co-founder Jack Dorsey as the interim chief executive, effective from July 1. Analyst Anthony DiClemente said that the company could appoint a product-focused CEO, even from a larger internet company, including Google Inc GOOGL or Facebook Inc FB. Also, current CFO Anthony Noto cannot be ruled out as a possibility. In the report Nomura noted that Dick Costolo's departure "follows a number of departures of key Twitter personnel and comes amidst a period of uncertainty regarding Twitter's user growth and ability to monetize at scale." Twitter has witnessed quick leadership changes amidst a "consistent slowdown in user growth." Moreover, YoY monetization growth decelerated to 45 percent in 1Q15, marking a decline of more than 20 percentage points relative to 4Q14. Management reiterated weak 2Q15 guidance, maintained its outlook for revenue ranging between $470mn and $485mn as well as EBITDA ranging between $97mn and $102mn. However, the company cautioned that "user growth remains tepid," DiClemente wrote. DiClemente believes that there are "a number of potential positive catalysts" in the near term, "including the launch of the Google DoubleClick partnership as well as the continued rapid growth of Periscope."