#BIGMONEY: Twitter Stock Skyrockets On First Day Of Trading
CHICAGO (CBS) -- The hottest initial public offering in recent memory opened on Wall Street on Thursday.
And, at least for one day, it lived up to the hype. CBS 2's Ed Curran reports.
Twitter was priced at $26 a share, blasted off at the opening bell at $46, peaked at $50 before closing near $46 a share. The puts the company's market value at around $26 billion.
Twitter is a free news and information feed that also promotes people and brands. And that's where analysts see revenue for the company.
The top Twitter account in Chicago is OMG Facts, with 5.8 million followers. They tease you on Twitter and link you back to one of their websites--where they carry advertising.
That's how they use Twitter to make money.
Twitter itself has taken in $500 million this year. However, it has yet to make a profit, but analysts are expecting that will change.
How?
Twitter has three advertising products: promoted tweets, promoted Twitter accounts and promoted hot trends.
With promoted content, companies pay Twitter for placement on users' Twitter feeds
They also make some money by selling analysis of user data the collect.
At $46 a share, Twitter will have to continue its explosive growth to sustain that value, analysts say.
There are risks, including slower than expected growth and failure to develop new advertising opportunities.
Facebook is who you know.
Twitter is what you know.
In the end, Twitter is counting on that information--generated by its users--to make it big money
