Tomahawk, WI 01/07/2014 (BasicsMedia) – Twitter Inc (NYSE:TWTR) has had a good ride since it went public in an IPO on November 7, 2013. The stock is up more than 155 percent over is IPO pricing of $26 per share. Over the past two months, the stock has been in an impressive rally and investors have not been shy to take a bet.

In any case, several market studies have continued to paint a positive picture of the stock, especially its prospects in generating higher online ad revenue. However, of late this position is facing a challenge, the true picture may not the exact one that investors have had about Twitter Inc (NYSE:TWTR).

While the company is looking poised it end its loss-making profile, its fortunes in the online ad revenue look inferior to that of Facebook Inc (NASDAQ:FB) and Google Inc (NASDAQ:GOOG). Twitter Inc (NYSE:TWTR)’s fortunes are bogged down by its small number of subscribers and weak presence in mobile.

As concerns numbers, Facebook has comfortable lead with upto 1.2 billion monthly active users, this is more than four times that of Twitter Inc (NYSE:TWTR). On the other hand, Google has the numbers considering that it is the dominant search engine on the Internet.

When it comes to mobile presence, we can see that Facebook is increasing getting more access from smartphones and other mobile devices. Twitter Inc (NYSE:TWTR) still has a lot of work to do in this area and this denies it the bargain power. Many studies have shown that mobile revenue is going to overtake desktop revenue. This explains why Facebook is not only adding more features to its mobile platform, but it is also making deals with telecoms operators to expand its mobile penetration.

Late last month, Facebook announced a deal with T-Mobile (TMUS) which will allow subscribers in the network to access Facebook free of charge. This was the first such move in the U.S. and one of the many deals that Facebook has cut with operators in emerging markets. We are yet to seem Twitter Inc (NYSE:TWTR) make such bold moves or a promise to that effect. It thus goes without saying that however much Twitter Inc (NYSE:TWTR) is growing, its growth if far from winning the battle for online ad revenue.

Funds making cautious bet on Twitter

According to the latest available fund disclosure, we can see that funds are very cautious investing in Twitter Inc (NYSE:TWTR) stock. At the IPO, funds run by Fidelity Investment made a modest move in the stock, purchasing 2.4 million shares at $26 per share which translates to about $62.4 million.

However, over the same time, the fund invested about $1.6 billion in Facebook. This is a clear indication that funds have always been concerned about the prospects of Twitter Inc (NYSE:TWTR). It is however important to point out that those who invested in the stock at the IPO have made big gains now that the stock is trading around $65.80 and having touched highs of $74.23, following a launch at $26.

Twitter Inc (NYSE:TWTR) will be able to boost its ad revenue if it goes big on mobile, attracts brand advertisers and continues to add numbers to its network.

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