Worldwide is known the fact that Twitter Inc. has filled in its IPO offering up 472,613,753 shares of stock in this initial release. Under these circumstances, Twitter had to reveal its revenues which for 2012 were $316.9 million and in the first half of 2013 they have already earned $253.6 million. The company is having 218.3 million monthly active users which have created over 300 billion tweets so far. As it concerns the IPO, Twitter is expecting to raise $1 billion.
JOBS (Jumpstart Our Business Startups) Act made possible the Twitter IPO as it allows companies with less than $1 billion in revenue to file for an IPO. JOBS Act is design to encourage funding of United States small businesses. The company will list as “TWTR” and news about this event already alerted investors. On the other side, the situation could look like a double-edged sword as the listing of the company has both advantages and disadvantages. On the one hand the company is raising more money for investments and is getting cheaper access to capital, increasing its popularity. On the other hand, it exposes its financial and business information, risks that money won’t be raised and also risks that influential users may consider other investments more relevant and thus will lose its credibility as a safe investment.
As it concerns Twitter’s main rival in the social media field, Facebook is considered to be a strong competitor. Even if the two companies have their own advantages which are offered to the customers, it is expected to see the two giants always being compared and correlated. One aspect is clear, Twitter is still developing and it needs more time and a smart strategy in order to survive in the market.
Twitter is expected to begin trading later this year and speculations have started to appear. Thus, SunTrust Robinson Humphrey (a full-service corporate and investment banking arm of SunTrust Banks, Inc) already set a price target of $50. Given the fact that the company seems to start with the right foot, by the end of the year, investing in Twitter may be considered the best choice for an investment.
Twitter Inc. Chirps Louder Now by Silvia Gabor