NEW YORK (TheStreet) --
My beloved beliebers I'm officially retiringJustin Bieber (@justinbieber) December 25, 2013
What a week for Twitter (TWTR). The stock closed just shy of $70 today, blowing away its all-time high. It's up about 25% over the last five days alone. 79% over the last month. And just under 56% since going public.
Nobody's quite sure why.
In fact, Business Insider's Jay Yarow wrote a funny, but completely worthy story Tuesday titled, "For No Apparent Reason Twitter's Stock Has Gone Bananas." In the piece, Yarow quotes an analyst, who claims Twitter has achieved "cult status."
I don't have a super strong opinion on the stock, other than to say the following:
- It never hurts to take profits, particularly on such a massive winner; and
- Twitter can't miss -- not even a little -- on its first earnings report as a public company or things could get ugly fast.
Now, it could just end up a Facebook (FB) sort of ugly where everybody freaks out, sells the stock, publications like Barrons put out asinine $15 price targets and, before the reactionaries can remove their heads from their butts, the company adjusts and the stock starts rolling back toward $100. (That's the price target I set for FB back in November 2012; I stand by that prediction and raise you a $100 price target on TWTR!).
While you have to be cautious (because, again, things could get volatile), don't get caught up in the nonsense and pointlessness of a valuation argument.
Like other big-name "cult stocks," TWTR and FB continue to hash out narratives that are not only firmly intact, but quite impressive.
There's something to be said for being the town square. For occupying the space, television used to own. Justin Bieber doesn't call a network or music magazine when he wants to screw around and trigger 100,000 plus RTs. He doesn't have to. And those old-school platforms were never really appropriate for such spontaneity anyway.