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Comment by capkutay | Hacker News Reader

I'm not of those people who thinks all tech valuations are insane, but I think it is hard to justify twitter being worth 150x their quarterly revenue (~$36b valuation/~$240m revenue). I understand twitter's valuation reflects the fact that it's a growing company, but even a company like facebook is only valued at 60x their quarterly revenue ($158b/$2.5b quarterly revenue).

But at least the consensus on wall street and the financial press seem to agree that TWTR is clearly overvalued.

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Growth investors don't invest off of current revenue or earnings. It's how they expect these numbers to grow in the next few quarters/years.

So if you're going to be bearish on TWTR (which is fine) you probably want to go after their guidance or growth metrics. Their revenue growth is still growing, so you'd have to make the case that it will flatline sometime soon.

It seems like speculation is a game everyone wants to play. Until a bubble pops.

>but I think it is hard to justify twitter being worth 150x their quarterly revenue (~$36b valuation/~$240m

What do you think is easy to justify for Twitter?

(I'm actually pretty confident in Twitter, I guess. They took ten years-ish to IPO and not a day goes by where I don't see a hashtag on several products be it a local political group or a super bowl commercial)

It used to be AOL keywords. Times change quick.

I was going to make this point, but more than just "things can change" - AOL keywords didn't start getting massively used in adverts/etc. (in the UK at least) until pretty much when AOL were losing relevance, for search and most other things. Really, marketing trends shouldn't be used as a signal for much more than "marketing people like doing this"

>It used to be AOL keywords. Times change quick.

Interesting idea. I was around for AOL keywords, they weren't the same nor were they used the same way by as many different types of people. AOL has a billion dollar market cap still, despite the times changing quickly. Does it mean Twitter will be around 100 years from now? Of course that's unlikely. (Isn't GE the only one left from the original US stock exchanges?) But I think Twitter has a solid shot for the next several years. #TwitterCouldLose80PercentOfItsUsersAndStillBeLargerThanAOLAtItsPeak

Hashtags aren't just twitter. Every service has hashtag plumbing now.

If it had no business model and no revenues at all, I would assume that the valuation might be higher, since it's far easier to sell on expectations, rather than real cashflow, which would somehow limit the speculator's unbound speculations.

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