Thursday, June 12, 2014

Twitter's Ballooning Market Cap

Twitter Inc.(TWTR) shares are flying again Thursday morning, as bullish momentum keeps building behind the microblogging site.

The stock has surged 75% this month and is up 180% since the company priced its $26 initial public offering in November.

Twitter sports a $38.1 billion market capitalization as of Tuesday’s close, according to FactSet. If Twitter were in the S&P 500, it would be among the top 20% of biggest companies based on market value.

UPDATE: Twitter jumped as much as 6.8% Thursday afternoon, pushing its market cap as high as $40.7 billion in intraday trading.

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By comparison, retail giant Target Corp.(TGT) has a $39 billion market cap, Yahoo Inc.(YHOO) has a $41.1 billion market value and Time Warner Cable(TWC) has a market cap of $37.6 billion.

The rally has confounded investors and analysts alike, who question whether the unprofitable company warrants such a high valuation. “It appears valuation metrics are irrelevant,” Blake Harper, an analyst at Wunderlich Securities, wrote earlier this week, “and that investors are betting aggressively on Twitter being the next great media-technology platform.”

Those bets on the so-called Christmas cult stock are getting more aggressive by the day.

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