NEW YORK (AP) — Twitter's stock debut is imminent. There's indication that Twitter could start trading at up to 74 percent above its IPO price.
Twitter's trading debut is the most highly anticipated since Facebook's last year. Twitter will trade under the ticker symbol "TWTR."
Twitter priced the initial public offering of stock at $26 per share, valuing the company at more than $18 billion based on its outstanding stock, options and restricted stock that'll be available after the IPO. The pricing means the short messaging service will raise $1.8 billion in the offering, before expenses.
The high price comes despite the fact that Twitter has never turned a profit in seven years of existence. Revenue has been growing, but the company is also investing heavily in more data centers and hiring more employees.
Here's a running account of Twitter's first day of trading, presented in reverse chronological order. All times are EST.
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— 10:50 a.m.: Range is now $45 to $45.25, or up to 74 percent above IPO price. Very close to debut.
RT @KenSweet: They're closing the book.
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— 10:45 a.m. AP's @KenSweet says current bid is $45.25. The debut is near in #TwitterIPO.
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— 10:40 a.m.: Patrick Stewart tweets on #Ring of opening bell as Twitter trade debut imminent.
RT @SirPatStew: Honored to join @ev @jack @biz @dickc & the @Twitter team at their historic IPO this morning. #Ring! pic.twitter.com/XaJpYW2kIh
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— 10:35 a.m.: It's getting close to Twitter's stock debut. First indication for opening price is even narrower: $45.50-$46.50.
The high end would be 79 percent above its IPO price.
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— 10:30 a.m.: AP's @KenSweet now says opening price narrowed: $45-$47.
He reports: "This is a good sign. Could mean we're finding the right price. Progress."
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— 10:20 a.m.: AP's @KenSweet says opening price is expected even higher: $43-$47.
The range for first indication means Twitter could start trading at up to 81 percent above its IPO price.
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— 10:15 a.m.: RT @KenSweet: I've heard some traders mention that this may not open until 1030, maybe 11. But things are changing rapidly.
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— 10:10 a.m.: AP market reporter @KenSweet explains the role @Barclays has in #TwitterIPO.
Trading for Twitter's stock is under the supervision of Barclays Capital. Twitter hired the bank to be its "designated market maker." A DMM supervises the trading of a company's stock. He or she is an experienced trader in charge of ensuring that buying and selling go smoothly. If trading becomes volatile, the DMM can step in and buy shares using his or her firm's own money.
DMMs are especially important the day a company goes public, because the DMM coordinates between Twitter, the company's investment banks and NYSE's floor traders to get a stock trading. If technical problems arise, the NYSE uses DMMs to bypass electronic trading systems, allowing humans to trade a company's stock. That is not possible on all-electronic stock exchanges such as the Nasdaq, which had technical problems during Facebook's IPO last year.
Barclays' role as Twitter's DMM does not mean it is in charge of the entire IPO process. That role falls to Twitter's investment banks: Goldman Sachs, Morgan Stanley and JPMorgan Chase.
Read more: http://bigstory.ap.org/article/twitter-picks-barclays-coordinate-ipo-trading
— Ken Sweet, New York, @KenSweet
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— 10 a.m.: #TwitterIPO first indication for opening price: $42-46.
That means Twitter could start trading at up to 77 percent above its IPO price. Trading is to begin soon as representatives from Barclays continue negotiations to find the right price.
— Ken Sweet, New York, @KenSweet
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— 9:50 a.m.: With the #Ring of the #NYSEBell past, what will happen? @KenSweet reports.
Traders gather around Twitter's booth on the floor of the New York Stock Exchange. At Twitter's post, the company's "designated market maker" starts taking orders from the traders, who are representing dozens of firms and hundreds of investors.
The goal of the DMM, who used to be known as the NYSE's specialists, is to figure out what is the best price to start trading Twitter's shares.
Due to massive investor and media interest in Twitter, the actual negotiation over what are the right price for Twitter's now-public shares will take some time. It could take as little as 20 minutes, or it could take an hour. The NYSE wants to avoid the trading debacle that Nasdaq faced with last year's Facebook's IPO, so it's going to be careful.
Read more: http://bigstory.ap.org/article/going-public-how-twitters-ipo-will-work
— Ken Sweet, New York, @KenSweet
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— 9:40 a.m.: The market is open at @nyse, though Twitter's stock won't trade right away.
RT @NYSEEuronext: #RING! Markets OPEN. #NYSEBell has rung, now begins #TwitterIPO price discovery. Wait for it . pic.twitter.com/gPxGgB6QWa
The opening bid is $35, reports AP's @KenSweet. It's the first indication of where the stock will open later in the morning.
As the NYSE's opening bell was rung, the graphic below displayed the hashtag #Ring!
Who rang the bell?
RT @NYSEEuronext: @Twitter owes success to its users, so gives #NYSEBell to @SirPatrickStew, @VivienneHarr & @Bostonpolice #TwitterIPO pic.twitter.com/fAprlGV8Vs
— Bree Fowler, New York, @APBreeFowler
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— 9:25 a.m.: What's being said on Twitter? IPO is the 10th most popular trending topic in the U.S.
IPO is behind Thanksgiving, Texas, NFL and #throwbackthursday.
Worldwide, it doesn't make into the Top 10. Nobel Prize-winning author Albert Camus does. It's his birthday, after all.
— Barbara Ortutay, New York, @BarbaraOrtutay
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— 9:05 a.m.: RT @KenSweet: Floor trader Kenneth Polcari thinks twitter's $26 share price is pretty fair. Doesn't expect it to double on the open.
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— 8:50 a.m.: Busy morning at @nyse trading floor, reports AP's @KenSweet
RT @KenSweet: Orders for Twitter have been coming in since 8 am, floor trader Jonathan Corpina tells me. Very busy.
RT @KenSweet: Corpina expects a smooth opening. The NYSE does IPOs all the time, he says. The difference here is volume and media attention.
RT @KenSweet: Traders use these handheld wireless computers to send orders. Paper orders ended a long time ago: pic.twitter.com/bwz8UK4xcB
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— 8:40 a.m.: Why Twitter went to @nyse. Pressure is on with opening bell less than an hour away. #lessonsfromFB
Twitter chose to go public on the NYSE over the all-electronic Nasdaq. One of the reasons why Twitter likely chose the NYSE over the Nasdaq has to do with problems Facebook faced with its Nasdaq-listed IPO last year. A glitch in Nasdaq's trading software led to trading delays and order failures on Facebook's first day of trading.
The NYSE isn't taking any chances with Twitter. The exchange tested its trading software on Oct. 26 to prepare for Twitter's debut. If the NYSE faces technical problems with its ordering software, the exchange can switch over the traditional human-based stock trading that dominated Wall Street for decades.
RT @KenSweet: NYSE traders and execs are really playing up the human element to this IPO. It's a shot across the bow at the Nasdaq.
Read more: http://bigstory.ap.org/article/twitter-list-new-york-stock-exchange
— Ken Sweet, New York, @KenSweet
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— 8:20 a.m.: AP markets reporter @KenSweet says media outnumber traders 5:1 @nyse trading floor
It's a media madhouse. But it's still more than an hour before the opening bell, so more traders should be coming. Expect a big crowd.
RT @KenSweet: The NYSE is decorated head to toe. with twitter logos. They went big here to promote: pic.twitter.com/pnwRQ9e6QG
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— 8 a.m.: After #TwitterIPO pricing, market debut comes Thursday.
It should come as no surprise that Twitter used Twitter to announce its public stock debut.
It began with a tweet on Sept. 12: The 7-year-old company posted on its official Twitter account that it has "confidentially submitted an S-1 to the SEC for a planned IPO." Details about offering emerged after the IPO documents were released publicly later.
On Oct. 24, Twitter set its IPO price target at $17 to $20 per share. It raised that to $23 and $25 per share, signaling an enthusiastic response from prospective investors. The actual price on Wednesday night was even higher, at $26. That bodes well for the company's stock when trading begins.
Twitter also took to Twitter to announce that price: https://twitter.com/twitter/status/398235511254298624/photo/1
The company is offering 70 million shares in the IPO, plus an option to buy another 10.5 million. If all shares are sold, the IPO will raise $2.09 billion, making it the biggest IPO for an Internet company since Facebook raised $16 billion last year.
Of course, Facebook made its debut with high hopes, only to see its stock fall below the IPO price by the second day of trading. Twitter has valued itself at just a fraction of Facebook and sought to cool expectations in the months and weeks leading up to the offering.
— Barbara Ortutay, New York, @BarbaraOrtutay
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