Given the rumors that Disney (NYSE:DIS), Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT) and Salesforce (NYSE:CRM) all appear to be interested in a buyout of Twitter (NYSE:TWTR), one would think the sale price would be a bit higher.
But according to SunTrust analyst Bob Peck – who has stated that a Twitter acquisition was unlikely to materialize this year – said the deal could happen for around $27 per share, or less. His case:
“For Twitter, we looked at the 30, 60 and 90 day averages and used 40% as a takeout premium. That level of premium would drive prices of $27, $26, and $24 – close to the original $26 IPO price and only up 3% to 15% from today’s price. Further, $26 share price would represent ~$20B transaction value, 22x EV/EBITDA (ignoring excess SBC) and 6.1x EV/Sales on 2017 street estimates – a slight premium to LinkedIn’s takeout multiples.”
