When Twitter eventually goes through an IPO, its investment bankers will be faced with the challenge of establishing a price per share for the company’s stock. To the uninitiated, this might seem like a simple task. The fact is there are several valuation scenarios that can be used to price a stock. I’ll describe two of these, and then I think you’ll be surprised with my guess about an alternative valuation the bankers might ultimately use.
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Taking Stock of Twitter
Posted by: Theodore F. di Stefano April 19, 2012 07:00 AMWhen Twitter eventually goes through an IPO, its investment bankers will be faced with the challenge of establishing a price per share for the company’s stock. To the uninitiated, this might seem like a simple task. The fact is there are several valuation scenarios that can be used to price a stock. I’ll describe two of these, and then I think you’ll be surprised with my guess about an alternative valuation the bankers might ultimately use.