News

Twitter shares skyrocket in stock exchange debut

Twitter shares skyrocket in stock exchange debut

TWITTER TRADING: Actor Patrick Stewart (R) and 9-year-old Vivenne Harr (C), who uses proceeds from her lemonade stand to fight slavery, ring the opening bell as Twitter co-founder Evan Williams and and Boston police officer Cheryl Fiandaca look on. Photo: Reuters

By Olivia Oran and Gerry Shih

(Reuters) – Twitter Inc. stock soared 92 percent in their first day of trading on Thursday on the New York Stock Exchange as investors snapped up shares in the microblogging site, pushing its market value to a heady $25 billion.

The shares opened at $45.10 a share, up from the initial public offering price of $26 set on Wednesday, then added to those gains, hitting a high of $50.

Sources said the flotation had drawn strong demand, with investors asking for 30 times the number of shares on offer as they bet on potential growth at the money-losing social media company.

The opening price valued the shares at about 22 times forecast 2014 sales, nearly double that multiple at social media rivals Facebook Inc and LinkedIn Corp.

Twitter executives including Chief Executive Dick Costolo and founder Jack Dorsey thronged to the floor of the New York Stock Exchange to witness the IPO. The Big Board snatched the offering away from Nasdaq after the normally tech-focused Nasdaq stumbled with the larger Facebook flotation last year.

“Facebook was so overhyped people felt like they couldn’t miss out,” said Kenneth Polcari, a senior floor official at O’Neil Securities Inc. “Twitter isn’t like that, though you can feel the excitement.”

British actor Patrick Stewart rang the opening bell at the exchange together with 9-year-old Vivienne Harr, who started a charity to end childhood slavery using the microblogging site.

“I guess I represent the poster boy for Twitter,” Stewart said, adding that he had only been tweeting for about a year and wasn’t buying Twitter stock today.

Twitter’s building staff opened its offices in San Francisco extra early, at 5:30 a.m. on Thursday. By 7:30 a.m., hundreds of employees had flocked to their 9th floor cafeteria to watch Stewart ring the opening bell on TV.

The microblogging network priced its 70 million shares at above the targeted range of $23 to $25, which had been raised once before. The IPO values Twitter at $14.1 billion, with the potential to reach $14.4 billion if underwriters exercise an overallotment option.

If the full overallotment is exercised, as expected, Twitter could raise $2.1 billion, making it the second largest Internet offering in the United States behind Facebook Inc’s $16 billion IPO last year and ahead of Google Inc’s 2004 IPO, according to Thomson Reuters data.

Twitter boasts 230 million global users, including heads of state and celebrities, but it lost $65 million in its most recent quarter and questions remained about long-term prospects.

It also lacks the ubiquity of Facebook or the “stickiness” factor that keeps people checking the No. 1 social network on a daily basis.

A Reuters-Ipsos poll last month showed that 36 percent of people who signed up for a Twitter account say they do not use it.

Recent Headlines

1 hour ago in Local Sports

Report: NHL Commissioner not considering expansion into Seattle now

Fresh
Photo Credit: WENN

NHL Commissioner Gary Bettman has thrown up a big stop sign in front of expansion plans focused on the Emerald…

yesterday in Entertainment

‘The Other Woman’ serves up revenge in comic female fantasy

other

"The Other Woman" is a somewhat rare species - a comedy by women, about women and for women.

yesterday in Sports

Pineda not only pitcher in majors to try pine tar

Home plate umpire Gerry Davis ejects New York Yankees starting pitcher Michael Pineda after a foreign substance was discovered on the right side of his neck in the second inning of a baseball game against the Boston Red Sox at Fenway Park in Boston, Wednesday, April 23, 2014.

The Yankees pitcher is hardly the first major leaguer to use pine tar to aid his grip. He just got caught.

yesterday in Local Sports

Green Bay vs. Seattle will cost you

Seattle Seahawks quarterback Russell Wilson tries to avoid the rush of Green Bay Packers outside linebacker Clay Matthews (52) during the first half of an NFL preseason football game Friday, Aug. 23, 2013, in Green Bay, Wis.

So you want to see 2014 NFL season opener between the Packers and the Seahawks…prepare to open up your wallet.

yesterday in Local Sports

Sherman says money equals respect

Seattle Seahawks Richard Sherman (25) comes up with the football as Seahawks' Earl Thomas (29) celebrates after Sherman intercepted an Arizona Cardinals pass in the second half of an NFL football game, Sunday, Dec. 22, 2013, in Seattle.

Seattle Seahawk cornerback Richard Sherman wants to get paid.