Wall Street is aflutter over Twitter, set to make the most anticipated stock market debut since Facebook in a huge test for social media and the technology sector.
No official date has been set, but Twitter appears on a fast track which could see its initial public offering priced as early as Wednesday for trading on Thursday, according to some reports.
The company will trade under the “TWTR” symbol on the New York Stock Exchange, breaking from the Nasdaq market used by a large number of tech companies.
There is considerable excitement about the IPO because Twitter is “a unique product that no one can replicate,” said Michael Pachter, head of equity research at Wedbush Securities.
Pachter and his colleagues said in a research report that they expect high demand.
“We believe that the market is likely to generate appetite for more than $1 billion in stock,” they said.
“The simple rules of supply and demand suggest that by limiting the supply of shares offered to the public in its IPO, Twitter will be unable to satisfy demand.”
And Twitter appears to have learnt a lesson from Facebook’s debacle in May 2012, marked by trading glitches, accusations about secret information and a plunge in the share value for months after the IPO.
“The Facebook situation last year was a perfect storm of an overheated private market, a fully priced offering, a massive amount of shares brought to market, all compounded by an historical technical glitch,” said Lou Kerner, founder of the Social Internet Fund.
“That confluence of events is not likely to occur again.”
As of its latest update, Twitter will seek to raise up to $1.6 billion — one tenth the value of the Facebook IPO — by offering 70 million shares in a range of $17 to $20.
That is a relatively small chunk of Twitter’s capital, and implies a market value between $9.3 billion and $ 11.1 billion — a conservative figure compared with some of the private market trades in Twitter so far.
Analysts say Twitter, unlike Facebook, will not flood the market, and that with demand exceeding supply the price will rise.
The early Twitter investors may not get maximum value right away, but could benefit over time from a rise in the share price.
Twitter does have a star quality that is likely to fuel interest, because it is a key platform for celebrities, politicians and journalists.