Twitter (TWTR) Enforces New Rules To Tackle Hateful Content

Shares of Twitter Inc. (NYSE:TWTR) surged 11.02% to close at $24.68 on Dec 18, following the company’s decision of enforcing the rules announced last month to handle content that promotes violence, hatred and harassment.

Per the blog post by Twitter, “Specific threats of violence or wishing for serious physical harm, death, or disease to an individual or group of people is in violation of our policies.”

Twitter revealed that accounts of organizations that promote violence or content that “glorifies violence or the perpetrators of a violent act” will be removed from the platform. Frequent violations of rules will result in permanent suspension of accounts, the company warned.

Twitter also added that accounts that engage in derogatory and hateful remarks “to silence another person’s voice” through abusive profile information in the form of username, display name or biography will be permanently suspended.

Images promoting abhorrence on the basis of race, caste and creed, disability or sexual orientation will also be removed from the platform.

As part of Twitter’s move to create a “safer environment”, it suspended the accounts of far-right group Britain First along with the profiles of its leaders Jayda Fransen and Paul Golding.

Moreover, Twitter users can now report profiles that they consider offensive as against reporting only individual posts previously.

Notably, shares of Twitter have gained 51.4% year to date, outperforming the industry’s 34% rally.

Focus to Increase Engagement

Twitter’s focus to drive user engagement by making the platform easier to use is expected to be accretive to its growth. The latest developments to make the platform more attractive to users are positives in our view.

We note that rising abuse on social media is a serious concern these days. Cyber bullying and trolling are a serious threat to user growth on the social networking platforms.

For a company like Twitter that has been facing lackluster user growth, the initiatives taken to combat hateful activities on the platform is prudent in our view.

On the last conference call, CEO Jack Dorsey was quoted saying, “we're taking a more aggressive stance in our abuse rules and how we enforce them.”

He also added that by publishing the company’s upcoming safety work planned through January 2018, the company has for the first time provided such visibility into its work and expects it to build “trust along the way.”

We believe that enforcement of strict policies will help the company battle extensive PR damage.

Zacks Rank & Key Picks

Twitter carries a Zacks Rank #2 (Buy).

A few better-ranked stocks in the broader technology sector include IPG Photonics Corporation (NASDAQ:IPGP) , NetApp Inc. (NASDAQ:NTAP) and NVIDIA Corporation (NASDAQ:NVDA) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Long-term earnings growth rate for IPG Photonics, NetApp and NVIDIA is projected to be 12%, 11.3% and 10.3%, respectively.

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