IB Net Payout Yields Model

Twitter: No Code Red Here


  • Twitter falls 7% after Elon Musk announces plans to terminate the acquisition of the social media company for $54.20.
  • The company appears to have a rock-solid contract to force Mr. Musk to complete the deal or settle for a sum in excess of the $1 billion breakup fee.
  • Based on a per mDAU value, Twitter has already lost 60% of their value since the covid peak last year.
  • The stock has immediate 60% upside on the unlikely close of the deal, or a larger user base to support higher stock prices when the economy improves.
Elon Musk attempting to terminate the Twitter (NYSE:TWTR) merger is no surprise. The unknown has always been any outcome of an attempt by the social media company to sue Musk. Either way, Twitter doesn't face a 'code red' event as suggested by a prominent analyst. My investment thesis remains ultra-bullish on the stock following a likely dip, as traders exit a position with a hoped for outcome of $54.20 per share.

Read the full article on Seeking Alpha. 

Disclosure: Long TWTR. Please review the disclaimer page for more details. 

Update - Oct. 4

As predicted all along, looks like Musk is forced to close the deal at the agreed to price.

-Twitter (NYSE:TWTR) has been halted for volatility, jumping 6.7% on a Bloomberg report that billionaire Elon Musk has sent a letter to the company proposing to proceed with his $44B buyout deal at the agreed price.
-That price was $54.20, and Twitter stock jumped to $45.40 per share before the halt.

Update - August 24

Such BS, the whistleblower complaint is pure garbage. Twitter has ~38% upside from the current $39 price. 

-Investment firm Rosenblatt downgraded Twitter (NYSE:TWTR) on Wednesday as the debate surrounding the whistleblower complaint from its former head of security has raised the risks surrounding the stock.

-Analyst Barton Crockett lowered his rating on Twitter (TWTR) to neutral from buy and lowered his price target to $37 a share from $52, noting there are now "meaningful uncertainties" surrounding the company's stock, especially as Twitter (TWTR) remains engaged in a legal battle with presumptive buyer Elon Musk.

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