Twitter plunges on growth fears; Green Mountain soars

SAN FRANCISCO (MarketWatch) — Twitter Inc. sank Thursday as investors expressed disappointment with the latest earnings report while Green Mountain Coffee Roasters Inc. rallied after announcing a major deal with Coca-Cola Co.

Twitter (TWTR)  disappointed investors with its latest earnings report late Wednesday, sending shares down 22%. The social-media company reported weaker-than-expected user growth and timeline views in the fourth quarter. The firm said it had 241 million monthly active users, missing expectations of 249 million. Revenue and earnings, however, impressed.

The quarterly results spurred a flurry of rating changes from analysts in its wake. J.P. Morgan Analyst Doug Anmouth raised his share-price target to $44 from $40. He wrote in a note: "Twitter reported mixed 4Q results as upside to ad monetization and higher Data Licensing revenue led to better than expected overall revenues and profitability, but user metrics lagged expectations, especially in the U.S., which remains a primary concern."

Green Mountain (GMCR)  shares jumped 26% after the coffee company said it was entering a partnership with beverage behemoth Coca-Cola (KO) to work on an in-home cold-beverage system under the Green Mountain brand Keurig. Coca-Cola shares were up 1%.

Shares of fellow in-home beverage marker SodaStream International Ltd. (SODA)  were also 9.4% higher, after initially dropping on the Coke–Green Mountain news. Investors bid up SodaStream following analyst speculation that PepsiCo Inc. (PEP)  could make a move to buy the company to better compete with Coca-Cola. "Pepsi has no place else to turn," said analysts at Citron Research in explaining why Pepsi might be interested.

Gainers

Akamai Technologies Inc. (AKAM)  shares surged 20% after the technology company said late Wednesday that its fourth-quarter profit rose over 18% as revenue jumped. The company, which runs a network of services and equipment to speed up the delivery of online content, has grown substantially in recent years.

Getty Images Twitter, whose headquarters in San Francisco, Calif. are pictured above, sank Thursday after its earnings disappointed.

"While growth on both sides of the business is strong, long-term price instability remains a meaningful risk," said Raymond James Analyst Michael Turits, in a research note. "With growth in Akamai's Media Delivery business and the stock price both near the high end of what have been highly cyclical historical ranges, we see that risk skewed toward the downside given the difficulty of forecasting MD pricing events."

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Walt Disney Co. (DIS)  advanced 5.2% after the entertainment company beat earnings estimates. The firm earned an adjusted $1.04 per share last quarter, compared with estimates of 92 cents a share, according to analysts polled by FactSet.

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Shares of Yelp Inc. (YELP)  climbed 20% after it reported that it trimmed losses last quarter.

O'Reilly Automotive Inc. (ORLY)  shares advanced 9.2% after it reported fourth-quarter earnings of $1.40 a share, above the $1.33 forecast by analysts. Shares of automotive parts retailer AutoZone Inc. (AZO)  rose 5.5%.

Vulcan Materials Co. (VMC)  shares rose 8.5% after the construction-material company said Thursday its fourth-quarter profit rose to 8 cents a share from 3 cents a share a year ago.

Alliance Data Systems Inc. (ADS)  shares gained 9.3%. The operator of loyalty programs and private-label credit cards reported core earnings of $2.39 in the fourth quarter versus analysts' estimate of $2.33 a share.

Cliffs Natural Resources Inc. (CLF)  shares are up 6.9%, rising for a second day. The stock has been somewhat volatile since Casablanca Capital LP said last week that it has taken a 5.2% stake in the resource company and demanded steps to boost share value.