Twitter Ends Day 1 As Public Company In The Clouds

Twitter’s offering price was $26 but by the end of the day the stock had risen dramatically and closed at $44.90. Earlier in the day financial analysts were arguing that the company had under-priced its IPO and “left a billion dollars on the table.” Nonetheless the execution of the IPO was deemed “flawless” by many, […]

Chat with MarTechBot

Twitter IPOTwitter’s offering price was $26 but by the end of the day the stock had risen dramatically and closed at $44.90. Earlier in the day financial analysts were arguing that the company had under-priced its IPO and “left a billion dollars on the table.”

Nonetheless the execution of the IPO was deemed “flawless” by many, especially in comparison to Facebook’s badly managed IPO. Twitter’s market cap is now $24.4 billion (up from $18 billion this morning). That’s only $10 billion less than Yahoo but quite a bit less than Facebook’s $115.8 billion.

Twitter close day 1

Still some financial analysts believe Twitter is overvalued and must justify its market cap. One analyst put Twitter’s price target at $30 per share. We’ll see how the market reacts tomorrow and whether there’s some very short term profit taking.

Twitter will be trying to grow revenues by appealing to traditional TV-brand advertisers as well as going after small businesses at the bottom of the advertising food chain.

According to two recent surveys Twitter has roughly 16 percent (Pew) to 20 percent (AP) penetration among US adults, which means there’s lots of room for growth. That’s the “half full” interpretation. Beyond this, very few of its ads are shown outside North America, which also represents a growth opportunity.

But how will Twitter grow “mainstream” usage and generate more frequent engagement? What new ad products or capabilities will it need to develop to satisfy relentless investor demands for quarterly revenue growth?

Stay tuned for more exciting adventures.


Opinions expressed in this article are those of the guest author and not necessarily MarTech. Staff authors are listed here.


About the author

Greg Sterling
Contributor
Greg Sterling is a Contributing Editor to Search Engine Land, a member of the programming team for SMX events and the VP, Market Insights at Uberall.

Get the must-read newsletter for marketers.