Five weeks after Twitter's IPO, the social media company's shares hit their highest point yet on optimism about ad spending trends.
THE SPARK: Mark Mahaney, an analyst at RBC Capital Markets, said that 59 percent of respondents in a survey of advertisers plan to increase ad spending on Twitter within the next year. Only 4 percent said they plan to decrease spending.
RBC and Ad Age magazine conducted the survey of 900 advertising professionals.
THE BACKGROUND: Twitter, which is based in San Francisco, has about 200 million users on its service, through which they can post 140-character messages. The San Francisco-based company makes the bulk of its money from advertising, and earlier this month it launched a new ad program that lets advertisers focus on a specific group of people and target ads at them.
ANALYSIS: The survey indicated that Twitter's ad platform is improving, Mahaney said in a note to clients Friday.
He nearly doubled his price target on Twitter's stock, to $60 from $33. Mahaney has an "Outperform" investment rating, equivalent to a "Buy" rating, on the stock.
SHARE ACTION: Up $2.52, or 4.6 percent, to $57.85 in midday trading Friday. Shares peaked earlier in the day at $58.20. The company's initial public offering priced its stock at $26.