Twitter IPO: Feeding Frenzy As Wall Street Sharks Circle
Twitter Inc. (NYSE:TWTR) has launched its IPO, and by all accounts it is successful so far. With no technical glitches like those that plagued Facebook Inc. (NASDAQ:FB) last year, the NYSE has proven that it can indeed handle the high volume of trades associated with the much hyped micro-blogging company.
The company’s stock is currently trading at $45.24, up $19.24 or 74 percent higher than its IPO price of $26 per share. The stock hit a high water mark of $50.09 per share, with the frenzy that ensued in the early trading. However, it appears that the traders have finally settled down to some extent.
Goldman Sachs set the initial price for Twitter Inc. (NYSE:TWTR) shares on Wednesday evening. The cost was determined to be $26 per share, which was a premium on the previous estimates of $17 to $20 per share.
However, the stock opened with its first public trade this morning at a price of $45.10 per share. While the surges took on the form of a healthy IPO that had heavy media attention, the stock has finally settled into what appears to be a normal trading pattern.
Who Will Profit?
With the stock currently up by nearly 75 percent, the question of who will make a profit off the company is in the forefront of everyone’s mind. The initial investors may stand to make a tidy sum if the stock holds its value or climbs. However, those who short the stock now may find themselves well compensated if the stock drops back towards the price set by Goldman Sachs.
The fact is that no one knows where Twitter Inc. will be a year from now. With the current leadership Twitter has flourished as a privately traded company. But now it runs the risk of activist investors like Carl Icahn becoming involved with its financial decisions.
Only time will tell who will really make a profit off the newly offered company.
Disclosure: Author represents that he has no position in any stocks mentioned in this article at the time this article was submitted.