IPO could Lead Twitter’s Valuation to Exceed $20 Billion

IPO could Lead Twitter’s Valuation to Exceed $20 Billion

Despite the fact that Twitter Inc.'s user growth is slowing, fund managers believe that nothing can stop it from trading higher. The microblogging service is valued at $12.8 billion. The figure is derived from the fair value being put by Twitter on its shares in an initial public offering filing last week.

It is projected by Ironfire Capital LLC and Gamco Investors Inc. that Twitter could be worth $15 billion to $20 billion once it kicks of trading.

The firm is confident and expecting that Twitter will seek a considerable rise in its revenue at a rapid pace as a result of global expansion. Moreover, it makes good money by attracting advertising firms to pay dollars for getting access to its more than 200 million monthly active users.

The filing showed that plethora of companies advertises on the service and this has led Twitter to double its revenue.

"The valuation is fair despite the lack of quantifiable profit. I anticipate the revenue to grow exponentially as retailers and media begin to explore ways to attract new customers through the use of Twitter", said Jeffrey Sica, who helps oversee more than $1 billion of assets as the president of Sica Wealth Management in Morristown, New Jersey.