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> There's no reason to assume Twitter shares can't reach the same levels ever again but it depends on how far that "again" is. If you bought at $33 a month ag
by riffraff 5y ago
> There's no reason to assume Twitter shares can't reach the same levels ever again
but it depends on how far that "again" is.
If you bought at $33 a month ago, you'll be now getting a 60% return. You can put that in another less risky investment and still have a very healthy return over the next 5 years, say 5% , less than the historical sp500 rate, you'd get to ~$69.
So if Twitter gets back to $70 in five years Musk's offer is still an ok investment, but its growth has been almost zero for the last 8 years, it's not trivial that it would become a powerhouse in the next 5.
- paxys 5y agoThink about it this way – if Twitter shares were to rise ~17% from where they are today, would >50% of investors immediately hit the sell button? If not, then why would the same number agree to this deal?
- riffraff 5y agoAgain, the 17% growth has to be considered with time in mind. If I guarantee you a 1000% return on your investment, would you give me a random amount of money? Probably not, if this happens in 50 years, but very likely if it's in 5.
- vanjajaja1 5y agoThe difference is that one option is selling a declining company today for 17% bonus, the other option is selling a company that has shown 17% growth. Its not the same comparison
- polishTar 5y agoThere's a selection bias you need to consider. Twitter investors probably wouldn't be Twitter investors if they thought it was on the decline without significant growth prospects.
- itstomkent 5y agoIs $70 in five years drastically different than $50 today? We've had what, 8.5% inflation in the past 12 months?