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Morningstar

Returning CEO No Panacea for Twitter’s Woes

We place little value on CEO Dorsey's star power and remain concerned that the board and the market are overly optimistic about his ability to reaccelerate user growth and engagement, writes Morningstar’s Rick Summer.

We place little value on Dorsey's star power and remain concerned that the board and the market are overly optimistic about his ability to reaccelerate user growth and engagement. Furthermore, we are unenthused that he is remaining as CEO of Square, a privately held payment company. We are surprised the board finds this arrangement acceptable, particularly with other qualified CEO candidates available. Although some believe that a star CEO like Dorsey can move Twitter into more direct competition with larger social networks such as Facebook, we view today's news as a neutral event at best. Dorsey has been able to influence the direction of the company in the past (having served as CEO at one point, as well as executive chairman), and it's unclear to us why it will be different this time.

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About the Author

Rick Summer

Strategist

Rick Summer, CFA, CPA, is a technology strategist for Morningstar, responsible for Internet and technology research. Before assuming his current position in 2014, he was a senior equity analyst. He joined Morningstar in 2005 as an equity analyst, covering software and Internet companies. He has operating experience in the wireless and software infrastructure industries and has worked as a private equity investor for UBS Global Asset Management.

Summer holds a bachelor’s degree in business administration from Emory University and a master’s degree in business administration from the University of Chicago Booth School of Business. He also holds the Chartered Financial Analyst® designation and is a Certified Public Accountant (CPA).

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