Elon Musk's latest move to buy Twitter is a sign to investors that it's time to ditch the stock, Stifel says. "We believe this sets a near-term ceiling on shares, detaches the company from fundamentals, and offers significant downside risk if Mr. Musk decides to abandon his offer or sell down his stake," analyst Mark Kelley wrote Thursday. Kelley downgraded Twitter stock to a sell from a hold rating, calling the move from Musk a "full blown Elon circus" that will result in the social media company going private or a major sell-off in shares if the Tesla CEO cashes out. The downgrade comes as filings published Thursday revealed that Musk wants to buy Twitter for $54.20 a share and take it private in a deal that would value Twitter at $43 billion . In a letter sent to Twitter's chairman, Musk said he would have to reconsider his shareholding position if the company turned down his "best and final offer." Musk first disclosed a 9.2% stake in the company on April 4 and later accepted a position on the board before backing out . Kelley maintained his $39 price target on Twitter, representing 15% downside from Wednesday's closing price. He also trimmed first-quarter estimates for the company, citing the conflict in Ukraine and inflationary pressures. Twitter shares were recently trading up 1%.
The Twitter logo is displayed on a smartphone screen on April 14, 2021.
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