Will The Google Partnership Boost Twitter Meaningfully?

In a report published Monday, Axiom Capital analysts maintained a Buy rating on Twitter Inc (NYSE: TWTR), while raising the price target from $60 to $63, ahead of the company's 1Q15 results.Twitter is scheduled to report its 1Q15 results on Tuesday. The analysts expect Twitter to post robust financial results, with user growth in-line with guidance. The revenue and EBITDA estimates for 2016 have been raised by 2 percent and 3.5 percent, respectively.In the report Axiom Capital noted, "Advertiser checks show that Twitter is becoming a "must-buy" with each successive quarter and we believe product enhancements should drive increased usage overtime. Our positive stance goes beyond this quarter and looks at the opportunity for stronger financial performance over the next two years."The analysts believe that Google Inc (NASDAQ: GOOGL) may be interested in buying Twitter, given that the former's social media efforts "have largely floundered.""The syndicated partnership with Google is expected to drive revenues to Twitter, but we also believe it will drive non-logged-in users to the logged-out page where they could be enticed to become registered users. The mobile feed now has a more Instagram-like feel to it, which should keep users engaged and returning," the analysts wrote.User growth could be boosted in the longer run by the instant timeline, private messaging enhancements and direct video sharing and video recording. "Usage has become more difficult to track but anecdotally we are seeing more of our email contacts becoming Twitter users over the past two months," the report added.Twitter is currently testing auto-play video and ads on profile pages as well. Periscope, which is a live streaming app, is likely to aid Twitter to capture "a more meaningful slice of the online video market." The analysts believe that advertiser penetration is a "huge opportunity" for Twitter, since merely 60K advertisers are currently on the platform, as compared to 2M on Facebook Inc (NASDAQ: FB) and approximately 8M for Google.