Update: Shares of Twitter (TWTR) opened up at $45.10 and within the first hour of trading reached a high of $50.09 before leveling off around $46 by afternoon. The stock closed at $44.90 which represented a 73% gain above the IPO price but below the opening price of $45.10.
Can Twitter justify a valuation of $31.7 billion dollars? We will find out once the company reports fourth quarter earnings in January. According to Minyanville, analysts are expecting $218 million in revenue which assumes 94% year-over-year growth. They also expect a significant spike in EBITDA over the next few years, hitting $395 million in 2015. However, bottom-line profitability will remain low with annual losses projected through 2014 until 2015 when the company is expected to post a profit of $0.18 per share.
Twitter IPO: 70 Million Shares At $26 Per Share
Twitter is one of the hottest IPOs of 2013 and is sure to garner the attention of the floor and media throughout the day. The IPO is worth approximately $1.82 billion and marks the second largest offering by an Internet company.
The IPO price of $26 per share is beyond the initial ranges of $17 to $20 and $23 to $25 earlier this week. None the less, investors will be chomping at the bit for a piece of the action. At $26 per share, Twitter will have a market cap of around $14 billion. That puts it above Groupon and Yelp, but below Linkedin and Facebook.
Twitter is selling 70 million shares which makes up13% of its total shares outstanding. Compare that to Facebook which sold 421 million shares or 20% of its shares outstanding.
If you missed Facebook then you might want to pick up some Twitter. That’s what some Wall Street traders are saying. There were a lot of disappointed investors who missed out on the Facebook IPO due to technical difficulties with the NASDAQ. The Facebook IPO turned out to be a complete flop with the stock closing below the IPO price of $38 per share.
We will be following all of the action from the opening bell, price action during the day and the closing. Be sure to revisit AMOG.com for all of the latest on the Twitter IPO.
What do you think? Are you going to buy into the Twitter IPO? We would love to hear your thoughts.