Now it’s everyone guessing what will happen next. FOX Business delves into the latest developments and what investors and analysts are predicting.
Do you backfire on poisons? : Wedbush’s ive
Wedbush securities analyst Dan Ives told the FOX business on Friday that Twitter’s move to prevent acquisitions from Mask is a “predictable defense” and “potential dilution and acquisitions. Given the unfavorable moves, shareholders are not willing to see it. “
The plan, also known as the “poison pill,” entitles shareholders if a company, individual, or group acquires a favorable ownership of at least 15% of Twitter’s outstanding common stock in a transaction not approved by the board of directors. You will be able to exercise. .. When the rights become exerciseable, existing Twitter shareholders have the right to purchase additional common stock at a discounted price, except for the individual, group, or group that triggers the plan. Musk is now 9.2% stake On Twitter.
“The board is turning its back on the wall, and Musk and shareholders are likely to challenge the benefits of poisons in court,” Ives explained. “Mask and his team believed that this poker move was expected to be perceived as a sign of weakness, not strength of the street.”
Mask and Twitter scramble for next move
Going forward, Ives said Musk needs to provide the details behind the $ 43 billion bid funding and return to Twitter’s board with a formal response. Meanwhile, he hopes Twitter will begin a strategic process to find other buyers.
|TWTR||Twitter Co., Ltd.||45.08||-0.77||-1.68%|
Mask offering to keep Twitter private $ 54.20 per share, The $ 43 billion bid is said to be his “best and final” proposal. But he was on Thursday at TED2022, “Next plan” If the offer is formally rejected. He didn’t elaborate on the details of the plan.
Twitter shares YTD
Continue Twitter for a long time: T3 Trading
Scott Redler, chief strategist at T3 Trading, believes investors should stay on Twitter for a long time, and the company is now “underestimated” and “managed” as it could become a platform for social improvement. Claims to be an “insufficient” asset.
“I don’t think Twitter is a private company. I think Elon should join the board. I should have bought 14% so I was able to shake the tree,” Redler said. Thursday’s countdown “. “I think the company can run better. I think the features will be updated more. I think they can get more users. They can make more money. And that’s what Elon will do a little. That was what I was doing. ”
“But this $ 54 bid wasn’t enough. He could get in because the market doesn’t believe it and the board doesn’t know what to do. He’s the best and final. That said, it’s by no means the best and not the final. ” “So he created an unstable situation where it would be interesting to see how it fell.”
Twitter can improve its product: JP Morgan
JP Morgan analyst Doug Ammus said the mask offer was “trustworthy” and “represented a 54% premium from where TWTR was trading before it began acquiring shares.” Told to. But he also admits that it is well below the company’s March 2021 highs. The company maintains an “overweight” valuation of its shares.
“If management can implement its plans to innovate its products, grow its user base by up to 20%, and build direct response ads, it will significantly increase its market share,” Ammas said in a Thursday note. “Therefore, we do not expect the offer to be accepted by the board.”
Stock Downside Risk: Stiffel
Meanwhile, Stiffel analyst Mark Kelly said the bid would “set a short-term cap on shares, separate the company from fundamentals, and Musk would either abandon the offer or sell the shares. If we make a decision, it poses a significant downside risk. ” Stifel has downgraded its shares from “pending” to “sold,” warning that Twitter shares could be “dramatically sold” if the bid is rejected.
Can Twitter find a consortium of investors? : Jeffreys
Jeffreys, who maintains a “hold” valuation for Twitter stock, said a 20% or more sale of rejected Twitter bids “certainly brings value to strategic investors.”
Jeffreys analyst Brent Chill said Thursday, “This is positive given that TWTR is likely to prefer an investor consortium rather than being dominated by a single large owner. It can lead to bad results. ”
Thill believes Twitter is likely looking for an offer of at least $ 60 per share.