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

Friday in Local

SD Cold Case Closed With Public Help

Marty Jackley 41814

SD Attorney General Marty Jackley said they could not have solved the cold case of the missing Vermillion girls without help from the public.

Friday in Local

Green Island Added to Missouri River National Recreational River

Rick Clark 41714

The National Park Service officially accepted Green Island from the State of Nebraska as part of the Missouri River National Recreational River

Thursday in Local

Tuition Freeze Deai In Doubt

Iowa state capital

Republicans in the Iowa House have voted to try to change the terms of a deal that would freeze in-state tuition for students at Iowa, Iowa State and U-N-I this fall.

Thursday in Local

More Testimony On “Hush Money”

money in hand

An official from the Iowa state agency under fire for confidential settlements that included “hush money” for laid off workers…

Thursday in Local

Nebraska Water Bill Becomes Law

WaterTap

Legislation that grew out of the work of the Nebraska Water Sustainability Task Force last year has been signed into law by Governor Dave Heineman.