Wednesday, November 06, 2013

WSJ: Twitter IPO could price above $25

I just saw this Wall Street Journal article that says:
Twitter's Inc.'s initial public offering is likely to price at $25 to $28 a share, according to fund managers briefed by Goldman Sachs Group Inc. and Morgan Stanley bankers, two of the banks underwriting the deal.
See:
 
The $25 to $28 price range is not beyond the realm of reason, but I don't have a lot of faith in these indirect rumors.
 
What I do know is that if I do get an IPO allocation, a higher price will translate into a smaller number of shares that I will be interested in. I mean, my appetite for Twitter is based on how attractively the deal is priced. $20 was my limit for a great deal. $25 is my limit for a reasonably good deal. But $28 is just barely a reasonable deal. I mean, at $28 I would rather keep a larger fraction of my money as cash to buy on dips. And at $28 a Facebook-like fizzle starts becoming a realistic scenario. Still, I will definitely want to buy something at $28.
 
-- Jack Krupansky

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