Twitter Inc Continues to Be in the Limelight
Twitter Inc (NYSE:TWTR) stock continues to gain on the back of ongoing acquisition rumors. TWTR stock stands to gain even more as reports have come in about another big player getting more serious about its possible interest in the social media company.
Reports came in on Friday that Alphabet Inc (NASDAQ:GOOG), also known as Google, has sought the advice of Lazard Ltd (NYSE:LAZ) for a possible Twitter bid. The company may not ultimately make a formal offer, but the fact that it is evaluating the option sends a signal of how valuable the Twitter database is.
It has been reported before how the real-time data that Twitter offers can be used by Google to improve its search capabilities. Google was already in a partnership with Twitter that gave it access to the stream of tweets known as “firehose”. With complete access to the firehose, Google had the means to access real-time information and use it to improve its search results.
News of a potential acquisition by Google comes on the heels of other possible bids for Twitter stock from players like Walt Disney Co (NYSE:DIS), Microsoft Corporation (NASDAQ:MSFT), Facebook Inc (NASDAQ:FB), and now salesforce.com, inc (NYSE:CRM). The constant speculation has led to Twitter stock gaining about 20% since the acquisition rumors broke out last month.
Earlier, TWTR stock had been losing value on the news of poor performance and uncertainty about its leadership. However, when Twitter CEO Jack Dorsey returned this year to lead the company into profitability, he introduced a new video streaming service. But it looked like a case of too little and too late.
On August 20, 2015, Twitter stock fell below its initial public offering (IPO) price of $26.00. The stock was publicly listed on November 7, 2013 and ended its first trading day at $44.94. TWTR stock had peaked around Christmas 2013, at about $73.00. The price has consistently been going down ever since, because the company has found it difficult to attract new users and make profits from its existing user base.
Chart courtesy of Stockcharts.com
Despite its problems, Twitter is a strong brand that has over 300 million active users. Investors can look forward to a further uptick in Twitter stock as the bidding gets more competitive. Each one of the competitors has its own way of benefiting from the vast amount of data that Twitter has access to, and each bigger would not like to lose this valuable possession to its competitors. This will likely lead to Twitter stock gaining further ground.