Twitter is finally going public a little earlier than anticipated. With a target price set at $23-25/share from the previous $17-20/share and a possible market cap of around $13.9B, what are your thoughts and guesses to what will happen on the first day of trading? Is twitter overvalued?
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It will probably skyrocket because we're in a tech bubble right now.
Anyone know when Twitter options will start trading? Could be Nov 15 but I'm not positive.
I think where it trades has little to do with what it's worth. I wouldn't be surprised if it immediately trades up into the $35-$40 range, if not higher...it could also shoot up to $50 then immediately tank back to $17...the point is it's a gamble.
If Facebook is worth $100BN+, I'd argue that Twitter is worth more than $14BN....users already use it on mobile platform and FB monetization on mobile gives you an idea of how much Twitter could eventually make per user on mobile.
I still think the multiples applied to FB are insane since I'd argue it's a pretty "mature" company as far as trying to monetize goes and expected growth rates...
User growth mature, but not necessarily monetization mature, revenue per user growth is the basis of the bull FB case. I really think twitter is a different story in that there is more user growth left. On the flip side, less user lock-in means they will have to work harder to stay relevant long term and have less headroom to piss of users, which equates to slower/less monetization of user data.
WSO Enjoyed following your comments on this thread as the IPO process went on, Kind of exciting to see the perspectives play into reality.
What's the chance that the real reason TSLA tanked last night was because people are cashing out of their 10 TSLA shares so they can pour their savings into twitter tomorrow?
lol, this is great
Probably going to do the same thing they all do. Skyrocket up, fall down to even, bump up, fall below even.
Who cares if it is overvalued. Is anyone even trading on fundamentals?
I'm thinking of going long small size and close out on the day... I'm sure there is room for a 20% pop. On one side, yes, its overvalued, even at 1b, but considering FB is 100, it's def undervalued at 14b. Cant' really trade on fundamentals with these valuations...
Also I don't believe that MS/GS/JPM are going to allow anything similar to FB to happen this time. That would be suicide.
I wish I had more cash on hand to buy in
You could sell your 10 shares of TSLA as Apple_iBank suggested above..
Pops 15%, Goldman holds it there for two days. Drops 20% day 3. Book it.
Look, Twitter has a great product. But the company has never been profitable, hasn't been moving in that direction (losses are actually increasing), and the user growth rates have been dropping at a pretty alarming pace. There's too much skepticism surrounding this IPO for Twitter to get a big pop. Plus they already revised the prices upwards. I mean, the FB IPO didn't have this level of negative press. People were predicting it to just blow-up. And look how that turned out. (And FB is really, really profitable!)
But on the flip-side, Facebook was a huge black-eye for Morgan Stanley. And I'm sure Noto and the Goldman team are being really fucking careful with the book. The Facebook debacle has got to be hanging over their heads. So maybe I'm being overly negative.
Twitter might open far beyond their $25 open price tomorrow. If it is the situation, that is good for short. 30% to 50% raise is reasonable at first day, from my standpoint, so buy a little if it miss that.
I plan to short it after the initial pop. $500mm in revenues for a deal that probably comes at $16-18B valuation... seriously??! I think in three years we'll look back and this will mark the absolute top of the current bubble. Twitter is like the eToys of this cycle. I mean seriously, advertising is basically a fixed pie, so if TWTR wins some of this its going to have to come out of Facebook, Google, or someone else. The model isn't going to work over the long term, as switching costs are literally zero. Good luck.
woah there...while the valuation may be insane given current monetization levels, let's not get ahead of ourselves and claim switching costs are low. What other platform has every celebrity posting when they take a shit?
Honestly though, once you're following your set of people and enjoy that discovery process, how/why would you switch when the only other platform with any scale clsoe to this is spewing sponsored stories in your face all day? Sure, maybe it will die a slow death as people move to a shinier twitter that we can't envision right now, but I wouldnt assume that the swicthing costs are "literally zero"...switching costs are very high if you're talking about losing access to content a lot of people value (whether you agree or not if 99% of the content on Twitter is valuable is less relevant)...
I'm actually long Twitter, if it was valued closer to $5bn....I'd argue that Twitter could be more sustainable than FB long term...
Nailed it there with respect to celebrities, no social network offers anything in comparison and that locks in users and has a load of potential for monetisation. Sure what they post is a load of shit but people lap it up, myself included!
Twitter will be like the cassette tape, or better yet Myspace/AmericaOnline. It's costless to switch to any of their competitors and people will do this as the site gets clobbered with ads. But more importantly, advertisers have all the power as more and more of these sites are added. If i'm trying to sell headphones to 23 year olds, I can advertise on any of Facebook, Yelp, Pandora, LinkedIn, Google, Twitter, any email server, or any of the 50 other sites that will come behind these. As a result, as more players enter, pricing will collapse and margins will fall to mature industry levels. Total ponzi scheme.
The other problem is the user base - mostly international. How valuable are most of those guys in Egypt or Uzbekistan to an advertising partner? Not very. I just think this one's gonna blow up like the HIndenburg. May take a few years... Nothing about these products is different from other industries, they're just younger. If anything, industry structure is worse.
My limit orders are in, let's get this bad boy up and running. Cmon investor frenzy.
what price? you think you'll get filled?
I put mine in at 27...I think more likely than not it won't get filled but I still have some hope since the market is down.
Indicating @ $44/share. Insane.
The Nasdaq is getting pounded in the ass today.
Gogo Pop.
Green shoe options incoming
I was in this stock...until I heard 43-46. Ridiculous. Now I might switch to shorting LOL.
Opened at $45. Mismanaged the shit out of that offering. Sick amount of money left on the table.
I think GS purposely left a lot of money on the table so they didn't botch the IPO like MS did with facebook
$48
What an absolute joke, it's up like 90% already... really makes you wonder if there is even a shred of legitimacy to the financial analysis those investment bankers are running. I'm sure as hell not being given any shares today. Screw the firm, screw the little guy (me)...sounds fair.
Market makers are loving this right now. GS and BAML leading the way.
How do you know it's those two?
how are people valuing this company?
Greater Fool Theory in full effect.
Who's the real greatest fool. Those buying the stock now or Twitter for selling the initial shares 75% lower than they could have.
In at 45.1111 out at 48.91 watching it blow up now. Thoughts on close?
Behavioral finance in superior form
So I bought Alcoa.
Let's set the date for the WSO Tech Bubble Burst Happy Hour now. I'm thinking 4 years from now?
Just don't plan to tweet the invitations, because I seriously doubt Twitter will be around four years from now. And I'm considered a power user.
I'm thinking much sooner than that....I say a year and half.
I can't believe this thing popped 75% by the time it hit the market, insane. I had my limit orders in but didn't expect the hype to lead to a $30B valuation. A short is starting to look really good right about now...
so how do you short when borrowing costs (plus probably a min short of $50k+) are so high and puts arent even trading yet? any other options?
Hope Jack's in a stripclub at this hour. He deserves it
Just to explain that GSVC play to those unfamiliar, it's basically an ETF made up of early stage tech companies. Its most recent disclosure (last month) said that Twitter comprised a little over 15% of the overall portfolio. Inexplicably, the stock is down today, despite Twitter near doubling on the open (thereby near doubling the NAV of 15%+ of GSVC). I'm thinking the disparity works itself out after market and we get a nice pop tomorrow.
probably can't liquidate Twitter shares until lock-out period is over. good luck.
TWTR up ~70% (peak was about 90%, but it closed in the mid 40s) means TWTR goes from 15% to "25.5%"(not exactly) of holdings - which would translate to a 10% gain in share price, assuming everything else holds its value.
Now, it's only up ~58% (which would be a 9ish % gain for GSVC, from before the TWTR hype).
It started ramping up from ~$10 in August. The earliest news about GSVC buying part of Twitter is ~August 12 (from what I can find), when it was at $12. Twitter's valuation was probably half of what it is now, so that'd be a 15% gain over $12... about $14. It's recent run-up was mostly on Twitter hype.
I'm not saying it's all baked in, but most of it is. Earnings release Monday so it's pretty much a coin toss from here.
So, now that the first day of trading is over what's everyone's 'Over-Under' close price for Wednesday, November 13?
I am picking that date based on the fact that it allows for the book runners to be far enough out of the window where they are still stabilizing the price and for those who were in at the beginning to take profits......
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