When Elon Musk walked away from the Twitter deal through his lawyers and a letter, Twitter looked
vulnerable. After Twitter’s legal suit and request for an expedited trial, the micro-blogging site has a
strong case.
Will Twitter win at least a billion dollars in a breakup fee? Will it force Musk to buy the firm for $54.20 a
share? Twitter staff already indicated nervousness about working for Musk. But the management team
opened up to the idea. It supplied all the data Musk asked for, up to a certain point. Unfortunately,
Musk questioned Twitter’s actual bot count of around 5%. The move looked like an attempt to lower the
sale price.
Twitter’s real bot count is not a strong enough reason for the Tesla (TSLA) CEO to back out of the deal.
All social networking sites have some automated, artificial users. Twitter’s real issue ahead is the
economic slowdown. Corporations are slashing advertising budgets. Twitter, along with Facebook,
Instagram, Snapchat (SNAP), and Pinterest (PINS) face falling revenue risks.
Investors do not need a law degree to predict the lawsuit outcome. They may prepare for a range of
possibilities. Investors may buy puts to bet against the deal going through. They could buy the stock
based on Twitter’s strong case against the purchaser.