Talk about a roller coaster ride, by now Twitter shareholders must have a serious case of motion sickness! In about a month’s time, shareholders have seen the price appreciate nearly 35% only to see it come crashing down to the $17 level or about $1 lower than prior to the buy out speculation. Most recently, Salesforce has backed out of a buyout offer making claim that they did not see much in the way of synergies with Twitter which further added to Twitter’s downside pressures.
What first looked like a quick-fire way of appreciating the company’s market capitalization, has actually damaged value, to the point where we wouldn’t be surprised if further buyout speculation actually reduced the share price. Management at this point must be considering Dorsey’s game plan to continue business as usual because the alternative is to allow other bidders to kick the tires only to realize that what they’re looking at is a really expensive lemon.
We continue to maintain our negative sentiment, buy out offer or not.