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Company profile: Overview and Market ProfileRecommendation and Market ProfileBrief Overview

Twitter inc. is a crossplatform online social networking service with 320 million monthly active users* available in more than 40 languages.

The total revenue in Q2 is $602 million, an increase of 20% YoY with an adj. EBITDA of $175 million - up 45% YoY (adj. EBITDA margin of 29%). Cost per Engagement in Q2 declined 64% YoY.

Listed on NYSE (TWTR), XETRA (TWR) and Mexican Stock Exchange (TWTR).

Company was founded in 2006 and is headquartered in San Francisco, California. Jack Dorsey – CEO, Omid Kordestani –Chairman.

Stock Price and Volume, 3Y

Sources: MFC Research team estimates,Company reports, Bloomberg, Thomson Reuters * As of 31st of December 2015

Relative Performance Dynamics, 1Y

1

Market Profile (multiples as 16E)

Closing Price 18.09 USD Market Cap.,$ bln 12.80

52 week low/high 13.73/31.87 Free-float, % 84.60

Av. Daily Volume 6 174 000 Beta 1.17

Diluted Shares Out. 712.53 mln Bid/Ask 0.01

P/E -30.5x P/BV 2.6x

60%

80%

100%

120%

140%

160%

180%

Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16

Dow Jones Internet Comp. S&P500 Twitter

Country: USA | Sector: Internet Services12M Recommendation: BUY | Target Price: $21.00

109.80% 111%

58.10% 14.60%7.90%

-76.50%

-21%-3.10% 4.80% 9.90%

2013 2014 2015 2016E 2017E

Sales growth (%) EBITDA Margin (%)

72%35%

17% 10%30%

6%39% 41%

-56% -64%Ql'14 Q2'14 Q3'14 Q4'14 Q1'15 Q215 Q3'15 Q4'15 Q1'16 Q216

Key Financial Metrics

Key Performance Metrics

Key Operating Metrics

Company profile: Operations and Financials

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US International Worldwide, rhs

694%

255%152% 78% 32% 53%

165% 153% 208% 226%

Ql'14 Q2'14 Q3'14 Q4'14 Q1'15 Q215 Q3'15 Q4'15 Q1'16 Q216

Monthly Active Users (MAUs) Growth,% YoY

Ad Engagements (Growth,% YoY)

Cost per Engagement (Growth,% YoY)

Sources: MFC Research team estimates, Company reports, Bloomberg, Thomson Reuters

-50.00%

-30.00%

-10.00%

10.00%

30.00%

50.00%

70.00%

90.00%

110.00%

130.00%

150.00%

170.00%

2013 2014 2015 2016E 2017E

EPS growth ROE Net debt/equity

Goldman Sachs= Buy

Deutsche Bank = Buy

UBS= Buy

Barclays Capital= Hold

Morgan Stanley= Sell

=> MFC RECOMMENDATION: BUY

Potential Deal Concerns New focus on live stream videos; Increasing investment in user protection

mechanism; Significant usability improvement; Development of video advertisement;

Comparablecompanies

(Gordon growth)DCF

EV/EBITDA 2016E

EV/EBITDA 2017E

EV/SALES 2016E

21.5 22.320.5 21.5

Comparablecompanies

(EBITDA multiple)

17 18 19 20 21 22 23 24

19.9 21.4

20.221.5067

22.119.7

Target Price 1 Year = $21

Valuation and Recommendation

3

EV/SALES 2017E 19.8 22.3

Sources: MFC Research team estimates, Company reports, Bloomberg, Thomson Reuters

Peer Multiples Management Strategy Positive Forecast

Current Price:Diluted Shares Out.Current Market Cap

18.09712.5312 889.13

Less: Cash & EquivalentsPlus: Debt

Adjusted EV

3 588.211 620.7210 921.64

4.83

6.8

16.85

5.22

101.2

18.58

32.95

15.33

P/S EV/EBITDA

Used by world’s most trusted media outlets (BBC, CNN and Times of India)

Strong corporate governance based on 6 independent and 2 employee (CEO, Chairman) directors with firm background

Highlights

2014 2015 2016E 2017E 2018E

EBIT margin 9.2% 13.4% 14.7% 17.3% 19.3%

ROIC 35.8% 68.7% 38.7% 49.4% 65.1%

P/E, diluted x 62.8 89.5 30.9 24.7 18.8

EV/EBITDA,x 92.3 37.4 11.7 10.5 9.6

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