The initial estimates of the price per Twitter share, after the presentation of the IPO with the Securities and Exchange Commission with Goldman Sachs, Morgan Stanley and JP Morgan as the main underwriters, were in a gap between 17 and 20 per share.
The figure had already been raised in a range between 23 and 25 dollars, and then up to $27 in the last instance, by issuing 70 million of securities on the market and providing an option to the underwriters to purchase another 10,5 million.
70 % More than Initial Estimates
An evaluation significantly higher than the initial projection, but analysts have estimated that the price on the day of the debut could spill beyond the established value of the offer.
In fact, at the opening on November 7 with the initials of Twtr, the title immediately jumped to 45.1 dollars, almost 70 % more than the initial forecasts.
Based on more than a little problematic experience of the Facebook quotation, the social with the bird decided to go public on the New York Stock Exchange, a stock market system “order -driven” based, less sectoral than the Nasdaq, specialized in the price of securities and software solutions, where the trading takes place instead in a “quote- driven” system.
Following the entry into the world share, in May of last year, Facebook had seen the value of its stock to lose more and more points in the days and months following the submission of the initial public offering, probably due to an overestimation of the shares with respect to the initial response of the markets.
A considerable disproportion that precipitated the price per share, thus risking even a refund to investors.
In the past year, however, Facebook has repaid the risk of shareholders, with a growth of +140 %, bringing the title to values well above those set out in the initial listing of the IPO .
Twitter Focuses on Mobile Advertising
To encourage the increase of the value of the stock in view of the submission of the initial public, Twitter had a clear strategy : the gains are derived primarily from advertising, although most of the revenue comes from grants the use of their data for analysis of user activity through the tweets.
About 75 % of users access the platform via Twitter mobile, and the acquisition of MoPub shortly before the entry in stock market shows the precise intention of Twitter to target the market for advertising on mobile, which generates most of the revenue in this sector.
With Instagram Twitter makes Take Off the Interest of Investors
Not to mention that, with a view to launching the offer, the release of the latest updates from the union of the group that provide Instagram and Twitter services, it is decided as an invitation to advertisers who, encouraged by the greater space given to campaigns promotion through the use of imaging, take off the interest of investors to buy shares of the company.
What can be the result of the entrance of Twitter in the world of finance?
A huge increase of advertising space, to the benefit of advertisers and shareholders, may be and to the detriment of consumers and the usability of the service.
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