Operationally, I'm sure the company is going to have a bang-up year next year.
But in terms of the stock, I think Twitter's much likelier to see a stock price with a 3 in front of it rather than a 5.
Thursday's initial public offering was tremendous. After initially discussing pricing in the teens a few weeks ago, with every tech blog on the planet complaining about low user numbers and decelerating revenue growth, the stock prices at $26 and opens at $45.
Good for the company. I'm happy for them, the New York Stock Exchange, and Goldman Sachs (GS) including Anthony Noto. They completed a near-perfect IPO. They showed Facebook (FB) how it should be done by following the LinkedIn (LNKD) playbook almost to a "T."
But there's no way that Twitter deserves a $35 billion valuation right now.
Even at $25 billion -- which would be around $36/share -- that's a stretch.
Yesterday, the exuberance took the stock right up to kiss $50. Then it immediately dropped back, closing below its open price. Today, it's slumping again.
As with Facebook, I think the underwriters are going to do their best for the next week or two to keep this thing levitating. But you can only hold your finger in the dike so long.
My guess is that this stock is heading shortly to the $30s, possibly low $30s.
There will probably be some new ComScore or Forrester report one of these days that says a sample of 20 13-year-old girls don't think Twitter is as cool as it was last December. The stock will drop 7% the next day and see carryover momentum.
It's not fair, but then again it's not fair those who bought the deal at $26 on Wednesday night got to flip it for a quick double yesterday. That's just the way the world rotates.
I hope Twitter sees the low $30s again and maybe we get a blah quarter out of them where there are again questions about revenue deceleration that forces more of a crisis in confidence in the stock. I think it will be a great buy at those levels.
A year from now, I see Twitter trading up to $60. It's too strong a platform, too strong a company.
But right now, these levels are too far, too fast.
At the time of publication the author was long FB.
This article was written by an independent contributor, separate from TheStreet's regular news coverage.