$1,000, 5 Years Later: Twitter Takes Off

Investors who have owned stocks since 2016 generally have experienced some big gains. In fact, the SPDR S&P 500 SPY total return in the past five years is 132.1%. But there is no question some big-name stocks performed better than others along the way.

Twitter’s Big Run: One company that has been a spectacular investment in the past five years is social media giant Twitter Inc TWTR. Twitter investors who bought back in 2016 and held on through some extremely volatile times have enjoyed a sizable payoff for their patience.

Twitter held one of the most high-profile IPOs in recent history back in November of 2013, selling IPO shares for $26 and raising $1.8 billion. Twitter came roaring out of the gate after going public, but enthusiasm for the stock soon began to wane when user growth started to slow and the company struggled to effectively monetize its customers.

In recent years, Twitter has finally started to demonstrate its advertising business is taking hold, but it has still struggled with consistency in growth and earnings numbers. The company’s average revenue per user still reportedly trails competitor Facebook, Inc. FB by a wide margin.

At the beginning of 2016, Twitter shares were trading at around $22.50. Shares initially dropped as low as $13.73 in early 2016 as Twitter struggled with its growth metrics.

Twitter rebounded to as high as $47.79 by mid-2018, but it spent most of 2019 trading back down in a range of between $26 and $45.

Related Link: How Much A $1,000 Investment In Qualcomm 5 Years Ago Would Be Worth Today

Twitter made its pre-pandemic 2020 high of $39.64 in February of last year before the March market sell-off dropped the stock back down to $20.

Fortunately for Twitter investors, social distancing ended up being very good news for social media engagement in an election year, and Twitter broke above $50 per share ahead of the November election.

Twitter In 2021, Beyond: Twitter’s momentum continued in early 2021, sending the stock as high as $59.60 even after the company made the controversial decision to kick former President Donald Trump from its platform.

Twitter investors who bought five years ago and held on now have big profits to show for it. In fact, $1,000 in Twitter stock bought in 2016 would be worth about $3,946 today.

Looking ahead, analysts are expecting Twitter shares to take a breather in the next 12 months. The average price target among the 34 analysts covering the stock is $51, suggesting 12.4% downside from current levels.