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| TWTR: We've had a nice run for two years, but it's time to take profits. |
Having missed out on Facebook (I thought in 2012 that its IPO valuation was pricey at $100 billion--owning FB would make sense if the company was worth a crazy $200 billion by 2015, now it's north of $500 billion!), I did buy some Twitter in March, 2016, at $15.95 per share as an entrée to social media investing.
TWTR had continually disappointed analysts since its 2013 IPO at $26 per share. I rationalized the purchase by thinking that it did not have much further to fall; if it continued to under-perform someone would buy it for its brand recognition. Whatever the reason, it's been a happy ride to $36.80 last week.
Then the dam broke. Facebook has been called on the carpet by media and government officials not only because data on millions of users was "harvested" by the Trump campaign but also for allowing outside companies access to that data as well. Congressional hearings have been called, and its clear that both Democrats and Republicans are gunning for the social-media giant, albeit for different reasons which we won't get into here. The selling wave affected all social-media stocks, including Twitter.
There will undoubtedly be a lot of Congressional grandstanding over the next few months. There will be calls to regulate internet platforms like Facebook, Twitter, and Google. None of this will be good for those stocks, whatever one believes about their growth prospects.
I was happy to sell Twitter at $33.14 and will look to buying it back if it goes under $30.
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