17:21 07 November 2013
Social network giant Twitter had taken a very bold move as it drew closer to going public. The biggest microblogging site has raised the price of its initial public offering at $26 per share giving the social network a valuation of $14.2bn.
This amount is way more compared to its original target.
Twitter previously increased it target range between $17 and $20 to between $23 and $25 due to strong demand from investors.
However, experts said that this is more likely to stoke fears of a repeat of Facebook’s disastrous market debut in May, 2012.
Just like Twitter, Facebook revised its target price upwards a number of times just before of its IPO. However, the shares quickly crashed. It took one year for it to recover ground.
Meanwhile, Twitter shares have begun trading and look strong.
Investors are still concerned about the fact that the company is yet to make a profit. Although it earned $165.6m in the three months to the end of September, net losses widened to $64.6m from $21.6m last year.
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