Earlier this month, Twitter (TWTR) filed its S-1 in preparation for its initial public offering. The only thing missing was the opening price. Twitter finally released those numbers and raised eyebrows by announcing that it would price itself between $17-$20. Puns aside, the pricing is quite cheap compared with its social-media counterpart: Facebook (META -3.98%).
At the mid-point of this range, this would value Twitter at roughly $12 billion including options and restricted stock units -- one-tenth the size of Facebook. Twitter has roughly one-fifth the users of Facebook and valued itself at $20.62 per share in August.
Could this point to a social-media bubble? With Pinterest being valued at $3.8 billion in a financing deal and Facebook and LinkedIn sitting near all-time highs, are social-media companies valued too richly?
In this segment of Tech Teardown, Erin Kennedy discusses Twitter's IPO and what it means to the social-media investing landscape with Jamal Carnette and Evan Niu, CFA.
