Twitter (TWTR)

Buy products online via the twitter application at night.
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Leading off our list is social media giant Twitter, which Goldman initiated with a sell rating on Wednesday.

Along with the bearish stance, Goldman analyst Eric Sheridan planted a price target of $60 on the shares, almost exactly where they sit today.

Sheridan has a generally positive view of the entire U.S. internet sector, suggesting that it still has plenty of room for long-term growth and operating efficiency improvement.

But in the case of Twitter, the analyst thinks its valuation is stretched and that the company’s innovation is largely a “show me story.”

Specifically, Sheridan isn’t entirely convinced that Twitter will be able to appeal to a wider audience base over time or capitalize on the more niche monetization opportunities that its current audience base presents.

In that sense, Sheridan feels that Twitter is more of a publishing platform than a social media platform like Facebook or Snap, which he both recommends as a buy.

Twitter shares slumped as much as 5% on Monday in response to Sheridan’s view.

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Airbnb (ABNB)

Close up of isolated mobile phone with red airbnb logo lettering on computer keyboard
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Next up, we have vacation rental leader Airbnb, which Sheridan also initiated with a sell rating yesterday. The analyst placed a price target of $132 on the stock, representing about 20% worth of downside from where it sits now.

Sheridan had some good things to say about Airbnb, calling the company a market leader in the space with attractive growth and margin expansion opportunities ahead of it.

In fact, the analyst expects compound annual revenue growth of 21% over the next five years and an adjusted profit margin of 32% in 2026. So for growth oriented investors, Airbnb might be worth purchasing using just your spare change.

But at the current valuation, Sheridan thinks Airbnb’s risk/reward tradeoff tilts negative due to the volatile travel environment going forward, a mature end market, and increasingly intense competition.

Airbnb shares quickly plunged 5% on Monday morning after Sheridan’s bearish call, but have largely recovered since.

Go your own way

There you have it: two popular tech stocks that Goldman Sachs recommends you sell today.

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About the Author

Brian Pacampara, CFA

Brian Pacampara, CFA

Investing Editor

Brian is an editor for MoneyWise. A long-time stock junkie, his work has appeared in The Motley Fool, Seeking Alpha, and Yahoo Finance. He believes in owning "Forever Stocks" — a rare group of businesses that have paid out dividends for decades. Brian holds the Chartered Financial Analyst (CFA) designation.

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