Recently, Twitter had preliminary talks with Salesforce.com in a bid to buy the struggling social media service. Although the sales process is still in the early stages for the company. Yet, on Monday, Walt Disney Co. surfaces as another potential bidder for Twitter Inc.
Currently, Twitter has a stock-market value of about $20 billion. In 2013, Twitter went public at $26 a share. In less than two months, it hit a high of $73. As recently as April 2015, Twitter’s stock price was still over $50.
By last Thursday, Twitter’s closing price dropped to $18.63. Rumors of a buyout by Salesforce, Disney or Google’s Alphabet drove up the price to $23.37 at Monday’s close. In a report, Pivotal Research analyst Brian Wieser wrote:
As the prospect of an acquisition of Twitter seems increasingly likely we are reducing the cost of capital embedded in our model to a point that is closer to many of its potential acquirers vs. what was previously embedded in our model, leading to a new $27 price target.
Robert Peck, an analyst at SunTrust, also agrees with the $27 or less price target. This would be valued at slightly more than LinkedIn when it was purchased by Microsoft.
Still, some analysts believe Disney would be the best fit. A Twitter acquisition would be Disney’s largest technology deal, beating investments in Vice and Hulu. Twitter has made the move into streaming sports events online, and Disney owns ESPN.
Disney Chief Executive Robert Iger spoke on the NFL games Twitter had hosted saying:
I thought Twitter actually did a very good job. That platform was powered by BAMTech last week and will be, which I think says a lot about that platform because it was very stable.