Is Twitter Overvalued?

As the non-existent volatility in the markets take a toll on my mental and financial well-being, I thought it’d be fun to indulge in some critical thinking, to kill some time. As such, someone asked me yesterday whether Twitter (TWTR) is Overvalued? The question certainly seems pretty legit, since the market doesn’t seem to think that way. In fact, investors are buying every single dip on TWTR that they can get their hands on. Personally, I’m a little mixed about the way I feel about TWTR, but I certainly don’t think TWTR should be trading above $40.

TWTR for me is a $15-$20 stock, and unless I see the company beat Wall Street estimates for 2 consecutive quarters, I’m going to stick with that opinion. To be honest, the so called “smart money” that’s being parked in TWTR, themselves don’t know WTF they’re investing in. Don’t get me wrong, TWTR is a great Company/Website, and I love TWTR; but that doesn’t mean I should log into my trading account and place a Market BUY on TWTR for 10,000 shares. That’s idiocy. Unless a company can definitively prove that they can generate consistent revenue, at least for 2 quarters and more, the IPO/Post-IPO price of a stock is irrelevant. It’s all HOPE, no real substance.

So my recommendation to you is, TWTR is an Overvalued stock and you should stay as far away from it as possible. Don’t touch this one until it comes back down to a reasonable price range .i.e. $15-$25.

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Wall Street Fool provides unbiased real-time market analysis and commentary for Stocks, Bonds, Futures, Forex, Fixed Income, and Derivatives markets.
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  • Sandeep

    What do you think about INTC as a conservative play on tech ?

    • wallstreetfool

      INTC looks pretty good. LONG Intel (INTC) with a price target of $26.

      • Sandeep

        long time ?? 1 year or 6 months ?