Twitter Could Be A Takeover Target, Says WSJ

According to the Wall Street Journal’s Miriam Gottfried, Twitter Inc TWTR may now have fallen to a valuation that makes it an attractive buyout target for a large tech or media company.

After giving up more than half of its market cap in the past year, Twitter’s stock now trades well below its November 2013 IPO price of $26. Although Twitter’s remaining market cap of more than $12 billion certainly limits its possible buyers to some of the larger players, Gottfried sees several potential Twitter buyers that make sense.

One of Gottfried’s top candidates is Alphabet Inc GOOGL. “Besides being able to extend its considerable existing ad-sales capabilities to Twitter, the search giant could use Twitter’s data to enhance its knowledge about mobile users for the purpose of ad targeting,” she explains.

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In addition, Gottfried believes that a Twitter buyout could be a huge step in expanding online ad capabilities and mobile reach for media companies such as Time Warner Inc TWX or Twenty-First Century Fox Inc FOXA.

Disclosure: the author holds no position in the stocks mentioned.