SunTrust Robinson Humphrey analyst Henry Martyn Robert Peck, the primary to rate the stock, steered Twitter might float at $28-$30 per share, and same it might reach $50 inside a year.
Twitter permits its users to post a most of a hundred and forty character messages referred to as "tweets" to share their personal thoughts and links to content with the general public and their friends, or to push businesses.
"It is very important for investors to appear at Twitter on the far side simply a a hundred and forty character text," Peck wrote in an exceedingly 76-page note.
Twitter's planned IPO is one amongst the foremost anticipated since Facebook Inc's coming-out party in Gregorian calendar month 2012. Despite posting massive losses over the last 3 years, Twitter hopes to woo investors with its promotion revenue growth.
The company, that started merchandising advertising solely in 2010, received regarding eighty seven % of its revenue from advertising within the half of the year.
Twitter's Sept acquisition of on-line mobile-ad exchange MoPub, that is viewed as its answer to Google Inc's DoubleClick, and its advertising alliances with broadcasters would boost advertising revenue, the brokerage same.
Peck same one amongst the largest opportunities for Twitter was to capture a region of the $200 billion world TV market with Amplify, that permits broadcasters to point out video clips and ads through tweets coordinated with what's being shown on TV.
Twitter might create use of the search capability with a product kind of like Google's AdWords, wherever advertisers pay Google in step with the amount of clicks on the ads, the brokerage same.
Keyword targeting, a feature that was solely unrolled in April, can facilitate the company's revenue, Peck said. he's rated four stars out of a potential 5 for the accuracy of his recommendations on web firms by Thomson Reuters StarMine.
E-commerce and mobile apps square measure alternative areas Twitter might benefit of to create revenue, Peck said. Three-quarters of its monthly active users square measure thought of mobile users, Twitter same in an exceedingly filing.
THE NUMBERS
Twitter has not same what number shares are going to be sold-out or at what worth.
Peck primarily based his numbers on a float of fifty million shares, raising up to $1.5 billion, taking shares on issue to around 537 million.
He then calculated his share target supported sixteen times enterprise price divided by revenue or eighty times enterprise price divided by income (earnings before interest, taxes, depreciation and amortization).
Twitter same in an exceedingly filing there have been 472.6 million shares of stock outstanding and no shares of its preference shares outstanding as of Gregorian calendar month thirty.
Peck same Twitter is that the dominant player within the "real time interest graph", that provides a singular possibility that few others will match.
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