Twitter CEO Decision Is 'Imminent,' Board Shake Up Is Next: Bob Peck
In a report published Friday, SunTrust Robinson Humphrey analyst Bob Peck offered a quick thought on Twitter Inc (NYSE: TWTR)'s CEO search, noting that a decision could "come as early as next week."
Peck continued that Twitter will announce a "Triumvirate of leadership" which will consist of Jack Dorsey (CEO), Adam Bain (COO/President) and Ev Williams (perhaps Chairman). The analyst also noted that Dorsey will be expected to remain CEO of Square as well.
Peck noted that it is "unclear" how institutional investors will react to Dorsey who will split his time with Square that is considered to be a "pre IPO company." However, he did state that this "Triumvirate" structure may be the best solution given the "complexity" of the company's turnaround and product road map.
When Twitter completes its new management structure, Peck suggested that a Board shakeup is "likely" to follow. The analyst argued that four of the eight seats will change, including: Peter Currie (Venture Capitalist), Peter Fenton (Venture Capitalist), Dick Costolo (ex-Twitter CEO), Marjorie Scardino (ex-CEO of Pearson and the Economist). Replacing the outgoing Board members will be new members with "more expertise" in media, technology, and operations – key areas of expertise that are "critical" to shaping Twitter's future.
While Peck acknowledged that a "solidifying" of Twitter's management team would be a "great first step" with a Board shakeup a "great second step," a turnaround in the company's fundamentals (users, engagement, ad effectiveness) will be "most critical" in achieving long-term success.
Bottom line, Peck remains "cautiously optimistic" on Twitter's long-term tailwinds (i.e., logged out users, Google Search deal), but only "once the dust settles."
Shares remain Neutral rated with an unchanged $38 price target.
Latest Ratings for TWTR
|Oct 2016||Loop Capital||Upgrades||Sell||Hold|
|Oct 2016||Evercore ISI Group||Upgrades||Sell||Hold|
|Sep 2016||Loop Capital||Downgrades||Hold||Sell|
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