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Despite the recent growth in digital advertising—and gains throughout the red-hot tech sector—Twitter (TWTR - Free Report) has struggled to emerge as a consistent stock pick. However, the company’s latest earnings report has underscored the thesis that this social media giant has finally turned things around, and now might be the best opportunity to scoop up TWTR in years.

Twitter is a microblogging platform that allows users around the world to quickly create, distribute and discover content. Led by co-founder and CEO Jack Dorsey, the company has recently made investments in livestreaming and doubled down on its effort to be the one-stop-shop for interacting with current events.

Right now, Twitter is a Zacks Rank #1 (Strong Buy) after another strong earnings beat has ushered in positive estimate revisions. Shares are now up over 30% on the year and are looking to break higher on the back of its report.

Latest Earnings Results

Twitter reported its fiscal third-quarter earnings results last Thursday. Interestingly, the company revealed that it has been unintentionally over-reporting its monthly active user (MAU) figures since 2014, but this quarter’s performance still crushed estimates.

Twitter added four million MAUs in the third quarter, up 4% from the prior-year quarter. The platform now has about 330 million MAUs. What’s more, Twitter’s daily active user count jumped 14%.

Overall, Twitter reported revenues of $590 million, which were basically in-line with our consensus estimate. Nevertheless, non-GAAP earnings of 10 cents per share came in well ahead of the Zacks Consensus Estimate of 6 cents per share.

The social media company also flaunted its commitment to live video. Management said it streamed 830 live events and secured 30 new live partnerships in the quarter. This video expansion helped total ad engagements soar 99%.

Looking ahead, Twitter said that it expects fourth-quarter profits to hit $240 million—the high end of its adjusted EBITDA range. The company also said that it expects to bring in about $1.21 billion in digital ad revenue for the full year, which would bring Twitter into the top six online advertising companies in the U.S.

Estimate Revisions and Growth Prospects

As we can see, earnings estimates have been moving higher in the wake of Twitter’s solid report. We’re seeing estimates for the current quarter gain on the back of nearly-universal positive sentiment, and estimates for the next fiscal year have been adjusted similarly.

Twitter has also emerged as an interesting growth pick. This year’s results have faced tough year-over-year comparisons, but the company will look to surge into profitability next fiscal year.

In fact, our current consensus estimates are calling for adjusted earnings of 36 cents per share, which would represent year-over-year growth of 7.23%. Moreover, revenues are projected to surge an additional 6.53% to $2.56 billion.

Valued-minded investors will call Twitter shares expensive at these levels, but now that investors can see the company’s video investments paying off, it won’t take long for the stock to break into a new range in this tech environment.

If management can ink another key streaming deal soon, Twitter will further differentiate itself from rivals Facebook (FB - Free Report) and Snap (SNAP - Free Report) , and investors should be the major beneficiaries.

Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

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