Oppenheimer downgraded Twitter to underperform from perform as the firm says a potential acquisition will likely be at a lower price level.



Twitter shares rallied 21 percent Friday after sources told CNBC that the social media company had moved closer to being sold.



"Based on slowing user growth, poor product implementation/execution, decreasing user engagement, inferior advertising technology, platform safety issues, and strong competition, we are establishing a price target of $17," analyst Jason Helfstein wrote in a note to clients Monday.

"We believe a media company is the most likely purchaser and would not pay meaningfully more than the valuation implied by our price target."