Twitter will price its shares at their upcoming IPO on November 15th (or sooner) at between 17 and 20 Dollars.
It's not greatly significant in itself, but would value the company at around 11 billion usd at these prices and these share prices will increase.
So Twitter is heading to that 15 billion usd mark.
It's not like the Facebook IPO in money terms, but it will be easily, in hype.
Twitter are selling 70 million shares to raise 1.4 billion usd in this initial offering. Facebook offered 400 million shares at 38 usd raising 16 billion usd.
The fundamental core behind getting involved in buying shares in a company is to whether or not you think it's a good company with a future. Period. If you think it is, then look at the numbers and take a view on the price and fully understand that Wall Street will manipulate you.
I think what Twitter does is great and hard to replicate, but there's room for improvement. Like the way tweets load at once and the constant security hack issues....but generally, it's a good one and only starting to show good advertising returns (which means there's a lot more to come).
But hey, be careful out there.
Most people lose their shirt.
Twitter's IPO is probably the most awaited floatation since Facebook.
Although still loss-making and small, it is growing and has revenues of 448 million usd in the last year, twice that of LinkedIn when it floated two years ago. LinkedIn then, was valued then at 4 billion usd (now it's 27 billion usd) and Twitter IPO expectations have been between 10-15 billion usd. Facebook we will all sorely remember, peaked at 100 million usd.
Twitter will shortly begin their investor roadshow and The FT have reported that a first day of trading is likely to be November 8th. Of course, they'll need to convince investors first, that they've turned a corner and will be showing greater future profitability. Twitter's revenues largely come from US traffic although it only accounts for 23% of Twitter usage, so reaching out globally, will be key. It needs its advertising to be better engaged outside of the US.
What Twitter needs to do is to instill confidence that it can generate good solid money in the longer term through advertising and avoid the hyped webby valuations. Facebook lessons still hang in the air and it's fair to assume that this IPO will be more measured, more considered.
Notwithstanding that, Twitter has a big following as being a good all round Social Media player with longevity. It's less "flash in the pan" and more down to earth with its potential for profit, still largely, unproven.
But all of these IPO's get the market's blood rushing. It's an opportunity for Wall Street to turn a profit quickly on "Mom's and Pop's" shares. So we will see their hype rather than Twitters. So be warned of pre-IPO publicity.
But, it's probably a good buy because getting on board now, in a reasonable IPO, reminds one a little of Apple founders.
What Twitter does is good and growing.
That's the fundamental.
