Tags: Doug Kass, Goldman Sachs wins again, pay no attention to the P&L, Twitter
With Carl Icahn exploring other means of communicating, Twitter will not be profitable until at least 2015. Of course, it will be profitable, especially if you are Goldman Sachs or can get in on the ground floor, one former Twitter user says.
“It is my view that Twitter’s shares will likely double in the first month of trading — or maybe sooner,” Mr. Kass, president of Seabreeze Partners Management Inc., said in an email….
“Given the lack of competition in its space, Twitter’s current monopolistic market position suggests a likely quick acceptance as an “anointed stock,” replicating the action of Internet service provider America Online in the early 1990s and Internet goods seller Amazon in the mid to late 1990s. As such, Twitter’s share price may not be required, as most stocks are, to achieve visibility of early profits. Indeed, pegging the company’s share price (similar to AOL and Amazon back in the day) to the traditional metrics of profits and cash flows will not likely be a headwind to appreciation over the next few years, as its dominant market share and top-line growth will be conspicuous.”
BofA Analysts See Twitter Unprofitable Through 2015 [WSJ MoneyBeat blog]
Goldman Slated for 38.5% of Twitter Fee Pool [WSJ MoneyBeat blog]
Doug Kass: I’d Pay $32.50 a Share for Twitter [WSJ MoneyBeat blog]