RiverPark Funds, an investment management firm, published its “RiverPark Large Growth Fund” third quarter 2021 investor letter – a copy of which can be downloaded here. The RiverPark Large Growth Fund (the “Fund”) returned -3.23% for the third quarter of 2021, while its benchmarks, the S&P 500 Total Return Index (“S&P”) advanced 0.58%, the Russell 1000 Growth Total Return Index (“RLG”) returned 1.16%, while the Morningstar Large Growth Category returned -0.07%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
RiverPark Large Growth Fund, in its Q4 2021 investor letter, mentioned Twitter, Inc. (NYSE: TWTR) and discussed its stance on the firm. Twitter, Inc. is a San Francisco, California-based social network company with a $29.5 billion market capitalization. TWTR delivered a -14.53% return since the beginning of the year, while its 12-month returns are down by -34.94%. The stock closed at $36.94 per share on February 4, 2022.
Here is what RiverPark Large Growth Fund has to say about Twitter, Inc. in its Q4 2021 investor letter:
“Twitter: Despite reporting in-line third quarter results, TWTR shares struggled at the end of 2021. For TWTR, the declines could be attributed to a fear of continued headwinds from Apple’s iOS tracking changes, as well as the stock continuing to be a show-me story after posting two disappointing quarters since its investor day in February (prior to this in-line quarter), as well as its recent CEO change (founder Jack Dorsey stepped down and is being succeeded by long-time CTO Parag Agrawal). Investors continue to be concerned with the platform’s user engagement, as total monetizable daily active users (mDAU) grew 13% year over year to 211 million, in-line with expectations, but still below management’s long-term target of 20% growth. Management expects mDAU growth to accelerate, driven by continued economic reopening and new features such as Spaces and Communities and an increase in the number and penetration of Twitter Topics. For the quarter, revenue increased 37% year over year to $1.3 billion and 4Q guidance was strong at about 20% growth, as Twitter has less exposure to Apple’s ATT headwinds.
With $4.8 billion of TTM revenue (only 4% of Facebook’s revenue), the company has a large opportunity to take share in the $200 billion global digital advertising market that continues to flow to mobile, Twitter’s focus. As the company continues to launch and improve its products (including stories, audio chat, podcasting, video and subscriptions), its platform should become more compelling to both users and advertisers, allowing it to take advertising dollar share through increased user engagement and ad pricing. As Twitter showed this year, we believe that the company can generate 20%+ revenue growth while also driving operating leverage in its already highly profitable business model, generating expanding excess free cash flow growth over time (3Q OCF grew 81% year over year).”
claudio-schwarz-purzlbaum-FMJAYeRwtDY-unsplash
Our calculations show that Twitter, Inc. (NYSE: TWTR) ranks 24th on our list of the 30 Most Popular Stocks Among Hedge Funds. TWTR was in 94 hedge fund portfolios at the end of the third quarter of 2021, compared to 89 funds in the previous quarter. Twitter, Inc. (NYSE: TWTR) delivered a -30.50% return in the past 3 months.
In November 2021, we also shared another hedge fund’s views on TWTR in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
