The claim is a major departure for the service, which has long been known as a destination for posting short snippets of text.
The claim is a major departure for the service, which has long been known as a destination for posting short snippets of text.
Something that I feel needs to be reiterated with all of these “news” pieces - the “71% drop” everyone is touting is from the stupidly high price Musk bought Twitter for that only ever represented his desire to flex, not the value held by the site itself. Even Musk knew it wasn’t worth that much and tried desperately to get out of the deal himself.
Which only means he double fucked himself from the start, not that everyone else is wrong for laughing at him
By all means, laugh away. He deserves to be mocked endlessly. I just appreciate accuracy/clarity.
Accuracy of what, your subjective opinion of Twitter’s value?
Twitter was trading around $40 at the time he made the offer for $54 per share. At the current value, that equals $15 per share. The last time Twitter was trading at that value was 2017.
These are all rough numbers based on some graphs I looked over quickly.
If you want to play devils advocate on this topic you should understand what you’re talking about.
What? I’m not really sure what you’re trying to disprove here. We seem to be in agreement that the buyout sum didn’t match the trading price*.
*The price before Musk started manipulating it with his showboating.
I don’t think you understand how someone takes a company private such as Musk.
No company is going to agree to a buyout lower than the trading pricing. The shareholders would reject the offer.
Even if we pick the $40 value for the public price, musk has erased over 60% of the value.
Do you understand the math behind your devil advocacy? Because from where I sit your argument can be summed up as: “well acktually it only dropped 60%” — except that’s not true. The people who backed Musks buyout lost the full 77% – they can’t go to their shareholders and claimed, “well actually we overpaid so we really only lost…” because that’s not how any of this works.
Why do you keep calling my comments “devil advocacy”? I’m not making theoretical arguments for the sake of debate. I’m saying that in real, actual numbers, Twitter was not worth $44 billion. That figure was purely invented by musk to show off. That he had to pay out is just karmic justice, not the objective valuation of Twitter.
And I’m not saying whoever put up that money isn’t losing tremendously, either. They definitely have, and that’s my point. Whether it was musk or someone he went begging to, it was an equally dumb decision since, again, Twitter wasn’t worth that much.
Also, since you seen like you may know, afaik the “71% drop” is purely from one investment company, Fidelity, right? Are they a reliable authority in this? The only other time I’ve heard of them was during the Reddit drama last summer, so to me they mostly come off as latching onto Internet drama rather than providing sound investment advice. Do they have a good track record to earn this level of credit the news is giving them?
If I sell someone a banana for $20, that banana is worth $20. Someone else may disagree with the value but that does not change the fact that in that moment the banana was valued at $20.
It means the person that bought it is a fool, nothing more.
You lack the information or understanding as to why it was given that value. You are the fool.
Feel free to prove me wrong with concrete numbers that back up your assertion with the true value.
I am confident you are not an investment analyst.
I’m the fool for saying a banana isn’t worth $20? That’s a weird line to draw. And I never claimed to be anyone here. I’m just pointing things out. Like this - musk literally had 4.20 in the cost “for the lulz”. Nobody’s convincing me that man had any idea of the “true” value of Twitter when he proposed his bid.
it would be accurate to say Musk assigned the value of $44B to Twitter by paying that much for it because that’s how capitalism works. He instantly inflated the price by paying far over its previous market value in a stupid showboating maneuver, and has, in doing so (as well as his subsequent antics) totally screwed himself and his investors by causing it to lose 71% of that value.
Correct.
It wasn’t just him though, he put up less than half the money. Other investors and lenders backed that price and hoped to profit after the purchase. I think it’s fair to say that the market valued Twitter + Elon at the price he paid, and was initially willing to pay more than what Twitter was trading at because they bought into the idea that he’d do good things with it.
Elon only wanted to back out after tech stocks overall dropped further following an increase in inflation concerns (they were already down, providing an opportunity for the buyout, but continued to fall after the deal). But most tech stocks have since recovered those losses and the nasdaq is up about 10% from where it was at the time of the deal.
The amount the Saudis are willing to pay to kill the platform so it can’t support the next Arab Spring and the amount “the market” thinks the company is legitimately valued at for non-ulterior motives are two very different things.
Him paying the full amount doesn’t really factor into my point, which is that Twitter wasn’t that valuable.
Somethings only worth what someone pays for it