Twitter raises IPO price range

The social network now aims to sell shares for between $23 and $25 each, up from an initial range of $17 to $20.

By Forbes Digital Nov 4, 2013 11:27AM
File photo of smartphone displaying Twitter logo (© Soeren Stache/dpa/Corbis)By Steve Schaefer, Forbes Staff

Twitter's roadshow must be going pretty well.

The social network has been pitching its forthcoming initial public offering to institutional investors over the last week-plus and raised the price range for the deal Monday morning according to an updated SEC filing.

Twitter now aims to sell shares for between $23 and $25 apiece, up from an initial range of $17 to $20, in a deal expected to make its debut this week.

The company plans to sell 70 million shares, which would raise $1.7 billion at the midpoint of the price range. With just under 545 million shares outstanding after the offering, that price would give Twitter an initial market cap of just over $13 billion.

In a note last week, Morningstar analyst Rick Summer estimated Twitter’s fair value at $26 per share, and that shares could climb to $50 in a bull case. Should the service “become ubiquitous like Facebook, the investment case is unusually strong,” Summer wrote in his report.

A more skeptical case on Twitter comes from Rapid Ratings, which issued a report last week saying the offering matched 92% of the characteristics of “Bubble-Era IPOs,” a considerably higher figure than either Facebook (FB) or LinkedIn (LNKD).

“Twitter is an earlier-stage company than FB and LinkedIn,” the report says. “In many ways, the Twitter IPO seems more reminiscent of the pre-2000 dot-com ‘Bubble era’ than other recent tech IPOs in 2012 and 2013.”

Shares of LinkedIn have more than doubled since the company’s 2011 and Facebook, which had a rocky debut in May 2012, is one of this year’s best-performing stock and has gained more than 30% from its IPO price despite being cut in half within a few months of the offering.

Twitter shares are expected to begin trading on the New York Stock Exchange Thursday, under the symbol TWTR. A group of executives and founders, including CEO Dick Costolo, Chairman Jack Dorsey and co-founder Evan Williams, will own slightly over 22% of the company post-offering, while a group of institutional investors including Rizvi Traverse Management, JPMorgan, Spark Capital, Benchmark Capital Partners, Union Square Ventures and DST Capital will own approximately 46% of the shares.

Goldman Sachs Group is the lead underwriter on Twitter’s IPO, followed by Morgan Stanley and JPMorgan Chase.

More on Forbes


11Comments
Nov 4, 2013 12:11PM
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I expected this BS...put in for 200 only to see it go up 6-8 bucks on the offer on an over-scribed-profit-less company built on hype...

Let me know when they make a profit, and when the price goes back to $15...

Moonshot my azz, Yeah maybe for a few days when you can't bail...

And I can't wait to see how the little guys fare...Plus not getting shares.

Institutions, trading houses, holders of record and rich guys get rich; While others hold the bag.

This isn't my/our first rodeo...nor IPO.

Nov 4, 2013 1:18PM
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do not do twit, or face.  Do you want dumbo and friends checking on you?
Nov 4, 2013 12:18PM
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The price of the Twitter non-product is going up? Well I'm just going to run out and tweet, twitter and trend this puppy right dang now!
Nov 4, 2013 1:08PM
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It really doesn't matter what most folks think about twitter. What does matter, it has a $1Billion line of Credit, almost another $2Billion coming from the IPO, plus the value of it's Stock. That can buy into the Fold, a ton of companies that actually do have real earnings and real business models. That's the most untold beauty of Launching a over hyped Company, perception can become reality.
Nov 4, 2013 5:33PM
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Twit for Twats, tits and tatas at Twitter farms. Easy pickins' at that meat factory!
Nov 4, 2013 1:44PM
Nov 4, 2013 4:15PM
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TCOLL....

The IPO date being offered, will probably be when the Market opens Thursday, Nov. 7th. or sometime that morning...

 

The indication of interest is/was from Oct 28th. "until today Nov. 4th at 4 pm."

70 million shares offered.

expected pricing was to be $17-20..

pricing on the Nov. 6th. and probably usually opened for offer on the next day. 

NOW:

Expected pricing to be $23-25...more then likely on the high end.(25)

And maybe offering up to 100 million shares...?

(part of that is in the article)....the rest was from my e-mail offering.

Nov 4, 2013 4:20PM
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Brent....Still not buying at that price....And now don't care what it does.

I've even heard price may go to $50 bucks opening day...

Where will it be 1st. of December...??

or 1st. of year...??

Nov 4, 2013 11:37AM
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The stock will bounce around at first but it will be a moonshot.It`s the wave of the future.
Nov 4, 2013 12:17PM
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RE-tog;Do you know how many young people have Twitter accounts?By Christmas it will be

millions and millions.In a couple of years almost everybody.They will swim in cash.

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