Investors all a Twitter means higher share price

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Investors all a Twitter means higher share price

Investors all a Twitter means higher share price
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Signaling that there is strong demand among investors for its shares, Twitter has raised the price range.

Wary of overpricing the stock – as Facebook did – the microblogging network had originally said the shares would cost between $17 and $20 dollars each at the New York Stock Exchange.

Now it says it is aiming for $23 to $25 dollars for the initial public offering.

A filing with the US Securities and Exchange Commission confirmed it expects to sell 70 million shares, which would raise 1.75 billion dollars (1.3 billion euros).

“This is not a surprise,” said senior analyst Kim Forrest of Fort Pitt Capital Group, which manages $1.5 billion in assets.

“The people underwriting the IPO have a responsibility to the company selling these shares to extract the highest price it can. It has to walk a fine line to make it attractive to investors.”

‘A year from now – $52’

Several equity research analysts said they expect Twitter shares to rise after they begin trading, with some setting their one-year price target as high as $52.

The IPO is set to price on Wednesday, with shares to begin trading on the NYSE on Thursday.

Facebook’s float was marred by an 11 percent drop in the stock on its second day of trading and successive declines over the next few months as investors questioned its ability to boost revenue through mobile devices.

It didn’t help that before its debut Facebook’s underwriters raised the IPO size by 25 percent and also hiked the price range.

The company also revealed on Monday that it had received a letter from International Business Machines Corp alleging Twitter infringed at least three US patents held by IBM.