Twitter, Inc. (TWTR)  

​Twitter Shares Soar After Report That Takeover is Closer


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Dan Weil | FlashRatings | Friday, September 23, 2016 1:26 PM EDT
Twitter’s stock (TWTR) jumped 20 percent Friday morning after CNBC reported that the struggling microblogging company is progressing toward a sale. 

Unnamed sources told the TV network that several technology and media companies have expressed interest in Twitter, which faces a stagnant user base and slowing revenue growth. A formal bid for the company may come soon.

The sources cited Google (GOOG) and Salesforce.com (CRM) as potential buyers. While none of the companies commented to CNBC, Salesforce.com isn’t exactly playing it coy. 

After the CNBC report hit the air, Salesforce.com chief digital evangelist, Vala Afshar, tweeted: “Why @twitter?
1 personal learning network
2 the best realtime, context rich news
3 democratize intelligence
4 great place to promote others.”

The CNBC sources said potential acquirers are interested as much in value of the Twitter’s data as in its value as a media company.

For months, analysts have been saying that a buyout is Twitter’s best hope for a rebound. The company posted 20 percent revenue growth in its June quarter, representing its smallest increase as a public company and its eighth straight quarter of sliding growth. Twitter has 313 million users, up just 3 percent from a year ago. 

A takeover isn’t guaranteed, of course, but one source told CNBC that a deal could transpire before year-end.

Wall Street analysts didn’t offer immediate commentary on the news. Of 26 analysts who published a report on Twitter in the last 30 days, only four were positive. The analysts generated a median price target of $16 for Twitter shares, down 28 percent from its level of $22.22 Friday morning.