Fidelity Raises X Valuation: Here's How Much It's Fallen From Elon Musk's Twitter Purchase Price
Portfolio Pulse from Chris Katje
Fidelity increased the valuation of Twitter, now X Holdings, by 11% in its Fidelity Blue Chip Growth Fund (FBGRX), despite holding it at a 68% discount to Musk's purchase price, implying a $14.1 billion valuation. The rise may be influenced by the performance of peer companies like Snap Inc (SNAP) and Meta Platforms (META), and Musk's hints at future AI company stakes for Twitter shareholders. Other major investors have also marked down their Twitter valuations, potentially affecting Musk's capital raising efforts. Fidelity's fund holds stakes in major tech firms, with NVIDIA, Microsoft, Apple, Amazon, Alphabet, and Meta as its largest assets.
February 01, 2024 | 6:26 pm
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NEGATIVE IMPACT
Musk's sale of Tesla shares to fund the Twitter purchase and potential future sales for additional capital could impact Tesla's stock.
Elon Musk's financing of the Twitter acquisition through the sale of Tesla shares, along with the possibility of further sales for additional capital, introduces a negative pressure on Tesla's stock due to the potential dilution and the diversion of Musk's focus.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
Meta Platforms' 9% increase in December and 162% rise over the last year may have influenced Fidelity's decision to raise Twitter's valuation in its fund.
As a leading social media company, Meta Platforms' stock performance can affect the valuation of similar companies. Its positive trajectory in December and over the last year likely contributed to a more optimistic valuation of Twitter by Fidelity.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
Snap Inc's stock rose 23% in December, contributing to the positive reassessment of Twitter's valuation by Fidelity.
The performance of peer companies like Snap Inc can impact the valuation of similar assets in investment funds. Snap's significant rise in December likely contributed to a more favorable view of the social media sector, including Twitter, now X Holdings.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60