This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Deal: Twitter Sets Up Revenue Streams Prior to IPO #ftw

NEW YORK ( TheStreet) -- Twitter is trying to assure that it doesn't repeat the mistakes of rival social media company Facebook (FB - Get Report), which took 15 months to catch up to what proved to be an overinflated float price.

Even as the market -- and its own investors -- clamor for the next "IPO of the year," the micro-blogging platform is lining up mega revenue streams to complement its billion-dollar ad business. This could have Twitter invading the space of live events promoters and app store operators like Apple Inc. and Google Inc., say those familiar with the company's plans.

The company has held off on decision-making regarding its initial public offering, sources said, in part because of the unknown trajectory of public markets for the rest of the year.

Indeed, there's a lot to be concerned about, from the central bank pulling back from asset purchases to a possible strike on Syria, plus the next round of Washington hyperbole concerning the U.S.'s deficit limit.

At least one investor, however, believes the time is right. "They could do it very quickly this fall," this shareholder said, adding, "I would go now, rather than in 2014."

The shareholder, who put the company's market capitalization at about $12 billion, suggested it would rise, but not past $15 billion, by the time it debuts on public markets.

That is a substantial contrast to Facebook, which saw eager institutional investors push an oversubscribed offering into a $100 billion market cap leading up to its IPO.

An investor in the company said Twitter could very easily raise a fresh round of capital for a longer stay as a private entity, but that few feel this is the optimal path.

The company has ramped up its revenue and is expected to exceed $1 billion in advertising revenue, a source said, but Twitter's true potential may lie in yet-undeveloped verticals.

News on Tuesday of the hiring of former Ticketmaster Entertainment CEO Nathan Hubbard signaled Twitter's intent to move from live commentary to live events. Though there are incumbents in the sector -- such as Live Nation Entertainment -- they have little presence on social and mobile platforms.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
FB $118.08 0.55%
AAPL $94.30 -0.92%
GOOG $695.81 0.50%
TSLA $234.18 0.80%
YHOO $35.97 -0.11%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs