Elon's Twitter Play: Valuation Question or Political Rorschach Test?

On April 4, 2022, Elon Musk announced that he had taken a 9.2% stake in Twitter, setting off a hectic chain of events, where he joined and unjoined the board, announced a bid to take company private, was thwarted by a poison pill and threatened a tender offer (by tweet). In this session, I argue that to understand and analyze this bid, you have to understand Twitter's history, from inception through its much-heralded IPO in 2013, and the disappointments that investors in the company have felt since. Along the way, the company has also cycled through five CEOs, with Jack serving multiple times, and faced corporate governance challenges, while at the same time, becoming a ubiquitous part of entertainment, news, sports and politics. I assess Twitter management's argument that Musk's offer is a lowball estimated, and Musk's counter that the company has untapped potential that existing management will be unable to exploit. I close by looking at the four possible endings to the story, ranked from most to least likely, and why the way you feel about this acquisition will be colored by your political leanings than by financial analysis.
Slides: https://www.stern.nyu.edu/~adamodar/pdfiles/blog/TwitterElon.pdf
Blog Post: https://aswathdamodaran.blogspot.com/2022/04/elons-twitter-play-valuation-and.html
Valuation of Twitter in 2022: https://www.stern.nyu.edu/~adamodar/pc/blog/Twitter2022.xlsx
My IPO valuation of Twitter in October 2013: https://www.stern.nyu.edu/~adamodar/pc/blog/TwitterIPO.xls

Видео Elon's Twitter Play: Valuation Question or Political Rorschach Test? канала Aswath Damodaran