NEW YORK (TheStreet) -- Shares of Twitter (TWTR) - Get Report were retreating in pre-market trading on Friday after RBC Capital Markets cut its rating on the stock to "underperform" from "sector perform."
The firm also lowered its price target to $14 from $17 on shares of the San Francisco-based social media platform.
The downgrade comes after RBC conducted a survey of more than 1,100 advertising professionals.
"This change is based on our belief that Twitter's value proposition to advertisers could be waning, based on our recent advertiser survey data. We note that we still believe Twitter is a unique asset with a strong value proposition to core users," RBC wrote in an analyst note.
Twenty-six percent of respondents plan to "significantly" or "modestly" increase their Twitter ad spending compared to 28% who intend to decrease, according to the survey.
"This is the weakest result we have seen and the first time we have seen a negative skew towards spending," the firm said.
Thirty percent of its survey respondents do not allocate any budget to the Twitter platform, up from 25% in February.
"And the % who are committing 1%-10% (an experimental level, perhaps) of their Online market budget with Twitter decreased to 54% from 57% last time," RBC added.
Additionally, 24% of respondents believe their return on investment has improved on the platform vs. 21% who think it declined. That is a negative move from the 29% vs. 21% split seen earlier this year, the firm noted.
Separately, TheStreet Ratings Team has a "Sell" rating with a score of D on the stock.
This is driven by some concerns, which should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks covered.
Among the areas that are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: TWTR