Twitter adds new advertising format as analysts downgrade stock

Twitter Inc. introduced a new advertising format for marketers to boost their presence on mobile devices, the latest product update since the microblogging company’s debut on the public market.

The new feature takes “promoted accounts” ads that normally run on the side of a Twitter timeline and puts them into a users’ stream of updates, the San Francisco-based company said today in a blog post. The change lets the promotions appear more prominently on mobile devices.

Over the past few weeks, Twitter has also enhanced keyword and audience targeting and integrated an acquisition that will help with advertising on other mobile applications. The rapid pace of product updates has boosted Twitter’s stock price following its November initial public offering, even as the stock fell today after downgrades from Wells Fargo & Co. and SunTrust Robinson Humphrey Inc. over questions about the company’s valuation.

“The company is still in a very nascent stage of its life cycle,” said Robert Peck, an analyst at SunTrust Robinson, who has the equivalent of a hold rating on the stock. “We think all of these announcements are positive, but expected, and they don’t fully explain the recent stock run.”

Twitter fell 4.5 percent to $56.37 as of 1:41 p.m. in New York. The company’s shares have more than doubled from their $26 IPO price.