Twitter shares plummeted despite an earnings beat on Tuesday, and investors may want to run for the door if the drop continues, CNBC "Fast Money" trader Steve Grasso contended.
The stock initially rose in extended trading after Twitter easily topped Wall Street's earnings and revenue estimates. But Twitter quickly reversed—falling as much as 12 percent—after Chief Financial Officer Anthony Noto said on its conference call that the company would not see "sustained, meaningful" user growth for a "considerable period of time."
Twitter traded around $32 per share at its lows in after-hours trading. Grasso—who owns the stock—said that shareholders may want to sell their stake if it falls below $29.50, a level reached last year.
"You better bail if it pops through that," he said.
Shares of consumer review platform Yelp also sunk in extended trading after earnings, falling more than 16 percent. The company posted a surprise loss, while third-quarter sales guidance was light.
The stock has shed 51 percent in the last year.
"There doesn't seem to be a low that's low enough," said trader Dan Nathan.
Trader Pete Najarian agreed, saying the business has shown "deterioration."
Social media giant Facebook has fared much better than Twitter or Yelp this year. Shares have risen more than 22 percent, and traders believe the run will continue after the company reports earnings Wednesday.
"I'm going into this bullish," said trader Pete Najarian, adding that Facebook has "taken over" social media.
"If you're still in the name, I think you've got to stick with it," added Grasso.
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