And I still hold to the view that fair market value is about 5% to 8% lower than current stock prices.
With this confusion, I expect a volatile market good for opportunistic traders, and that is my mantra through the rest of the year.
Twitter Explains Everything (Part Deux)
Originally published on Thursday, Nov. 7 at 7:36 a.m. EDT.
One theory holds that the $1.8 billion or so going into Twitter must be coming out of other momentum-type shares. Could that be the reason many were down big today? Only the sellers know for sure. The money to pay for the IPO has to come from somewhere.Respectfully, that is Silly Town, and the notion is nonsense. (NFLX - Get Report), Tesla (TSLA - Get Report) or Amazon (AMZN - Get Report) to buy Twitter is not the way the game is played. As I facetiously wrote last night:
Qualcomm's (QCOM - Get Report) forward chip shipment guidance suffers as companies hold back orders so they can participate in the Twitter IPO. Whole Foods Market's (WFM - Get Report) comps also suffer as consumers hold back grocery purchases in order to play the Twitter IPO as well (hat tip Zero Hedge).Today the media will be all about the trading action of the Twitter offering. We will hear the following song 40 times today via Bloomberg and CNBC:
He rocks in the tree tops all day longSimilar to the Facebook (FB - Get Report) IPO fiasco, which was never expected by the media (though it was by us!), we will be inundated with this sideshow to the markets.
Hoppin' and a-boppin' and singing his song
All the little birdies on Jaybird Street
Love to hear the robin go tweet tweet tweet!
-- Leon Rene under the pseudonym of Jimmie Thomas (popularized by Bobby Day and Michael Jackson), "Rockin' Robin"