This Twitter Bull Thinks #RIPTwitter Is Nonsense

Shares of Twitter Inc TWTR were tumbling recently, after rumors about the company implementing an algorithmic timeline surfaced. Reacting to the chatter, unsatisfied users around the world made the hashtag #RIPTwitter a trending topic.

On Wednesday, Twitter confirmed in a blog post that it would implement such a timeline, but added that users will need to "flip on the feature" for it to be activated.

One analyst was bullish on the stock, even before the market's positive reaction.

S&P Global Market Intelligence analyst Scott Kessler appeared on CNBC on Wednesday, talking about Twitter ahead of the announcement of its fourth quarter financial results.

The analyst said that, while many investors are “trying to bury the company and the stock,” he is hopeful that this will not happen any time soon.

The Twitter Paradox

"On one hand, people think and talk about Twitter as a no growth company," Kessler stated. However, they only look at user growth. If investors looked at the company's revenue, they'd see it is expected to surge about 45 to 50 percent this quarter. The analyst believes there is "a disconnect" between sentiment and reality, and thus, that there is an opportunity there. This is why he maintained a Strong Buy and $40 price target on the stock.

"I think what's happened over the last couple of quarters is that Twitter has been giving explanations, and arguably making excuses, as to why they haven't done as well as others and they would’ve liked," the analyst continued.

"The reality now is that we think it's time for the company to come together; the leadership team (with Jack Dorsey and Adam Bain being at the kind of helm of the company) really need to make their case as to why Twitter is here to stay, why Twitter is platform to be wackin’ with for the quarters and years to come, and –perhaps most importantly for the purposes of this conversation- why the company and the stock are undervalued: it's a $10 billion company at this point, with $4.5 billion in cash and investments as of the end of September."

There is plenty of flexibility and value in the company and the stock, Kessler concluded.

"We think the sentiment is way to negative; #RIPTwitter... we don't think that the end is near for this company or the stock."

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.