TWTR Stock: Why Shares of Twitter Inc Are Going Crazy
TWTR Stock Goes Up for Sale
Dear readers, some of you may have noticed that shares of Twitter Inc (NYSE:TWTR) jumped 28.27% over the last five days. If you’re wondering what’s happening with Twitter stock (TWTR), let me break it down for you.
The social media giant is reportedly up for sale.
As soon as rumors leaked of a potential acquisition, TWTR stock shot through the roof. It’s being viewed as the best endgame for Twitter stock, especially considering which companies are bidding on the sale. There are some heavy hitters on the list, but I think the biggest names are still a secret.
Any of these companies would pay a hefty price per share of TWTR stock. They understand what I’ve been saying for months now: Twitter is turning into a powerhouse of live streaming TV. The partnership deals with the National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), Major League Baseball (MLB)—and even the presidential debates—raise the potential of Twitter stock by several orders of magnitude. TWTR stock is way undervalued.
The stock could continue to skyrocket as various suitors bid up the price. We could see Twitter stock register gains of 75%, 100%, or even 150%. After all, the share price was trading 68% below its initial public offering (IPO) price just a few months ago.
Investors had dumped Twitter stock into the market’s bargain bin, but that only means there’s more room to the upside. Regardless of who buys Twitter, this bidding war just ensured that TWTR stock is a hot commodity. Everyone is going to want to get their hands on this unbelievable stock before its ticker is gone.
But let’s get back to the question at hand: who is trying to buy Twitter stock?
An Unexpected Suitor for Twitter Stock?
The first two names I heard mentioned were Alphabet Inc (NASDAQ:GOOG), otherwise known as Google, and salesforce.com, inc. (NYSE:CRM), both of which are tech giants. It’s easy to see how Twitter fits into Google’s business, but the salesforce.com offer makes less sense. Perhaps they want access to Twitter’s data pile? I’m not sure, nor is it clear why Microsoft Corporation (NASDAQ:MSFT) is in the running to absorb Twitter stock.
That makes as little sense as the salesforce.com bid. Both companies are enterprise software companies; that’s what they should stick to. On the other hand, Walt Disney Co (NYSE:DIS) would make an interesting parent company for Twitter.
With the advent of Twitter’s live streaming channels, it is ostensibly a media company now. Plus Twitter CEO Jack Dorsey sits on Disney’s board of directors. (Source: “How Twitter Could Change Under the Umbrellas of Disney, Salesforce, or Google,” Fortune, September 27, 2016.)
You’ve probably heard all of these potential suitors mentioned in the media. That being said, there’s one more company which I think wants to gobble up TWTR stock. Although this is entirely speculative, I have a pretty good record at forecasting mergers. I predicted the SolarCity Corp (NASDAQ:SCTY)-Tesla Motors Inc (NASDAQ:TSLA) merger seven months in advance, not to mention the Rackspace Hosting, Inc. (NYSE:RAX) sale a month before it became official. So bear with me for this wild theory…
I think Facebook Inc (NASDAQ:FB) secretly wants to buy Twitter stock. Here’s why.
Most people haven’t heard of Marc Andreessen, but he’s actually one of the most powerful people in Silicon Valley. Not only has his venture capital fund, Andreessen Horowitz, funded some of the biggest winners in tech, but he also has a huge following on Twitter. He is always dishing out his opinions on Twitter, which is why many people were puzzled by his sudden absence.
Here’s how abrupt his departure was:
Taking a Twitter break!
— Marc Andreessen (@pmarca) September 25, 2016
This left a lot of people scratching their heads, until some of us remembered that Andreessen sits on many boards of directors. It’s possible he has a conflict of interest in the sale. In case you’re wondering, yes he does sit on Facebook’s board of directors. It may sound strange that Facebook would consider buying its long-time rival. But I think it fits perfectly with Facebook’s past moves.
After all, photo-sharing was their main thing, yet they bought “Instagram.” “Facebook Messenger” was their in-house messaging service, yet they bought “Whatsapp.” Now they’re building “Facebook Live,” wouldn’t it make sense to buy Twitter as well? The deals with the NFL suggest that Twitter will become a juggernaut for live streaming TV.
If they act right now, Facebook can scoop up TWTR stock at a discount.
