This is just opinion-me, but I think he might be undervaluing the shares in the long-term. It's hard for me to square the price he's offering with the promises he's making about Twitter's potential profitability.
I guess for cashing out though it doesn't matter, since the shareholders won't need to care about what Twitter's stock does in the future. So, maybe you're right.
Easy to verify, we'll just have to wait and see if he succeeds.
> It's hard for me to square the price he's offering with the promises he's making about Twitter's potential profitability.
Those promises are predicated on him owning it though.
I'm doubtful of Twitter's LTV whether he owns it or not, but then again I've never had an account and now that you pretty much can't read it without one, I basically don't use it at all. So I may not be a qualified observer, but to me Twitter seems to only get worse for years now.
If that price isn't reasonable for Twitter long-term then you must have someone other than the current management in mind to realise that value...
I do think that Twitter's been getting steadily worse, but I'm not convinced that means they'll be less valuable in the future.
I think if I were an investor, my thought might be that Musk might not be necessary to realize that growth (again, speaking in the long term, not that the current price is wrong). But I'm not an investor, I don't really know Twitter's numbers.
I guess the caveat I should give is that if I were an investor and I thought Twitter was falling and that Musk couldn't save it, this would be a particularly good opportunity to jump ship. So that could also be an angle I'm not thinking of.
Twitter is a natural monopoly - evidenced by it's not having any real competition. Will it be a regulated monopoly? In that case, it should be valued like a water company. Is it an unregulated monopoly? In that case the market will decide if it can turn that monopoly into profits. There are a lot of commercial Twitter users. Charge them all ten cents a tweet. That adds up to about $10m per day.
You’re kidding. It’s a monopoly if you define the market as “Twitter”. There is no shortage of social networks. Certainly nothing about Twitter is a natural monopoly. Nothing prevents starting up a competitor or even a clone. The issue of locked in networks can be solved with regulation to open the data. It isn’t required that a single company own microblogging.
I guess for cashing out though it doesn't matter, since the shareholders won't need to care about what Twitter's stock does in the future. So, maybe you're right.
Easy to verify, we'll just have to wait and see if he succeeds.