Is Twitter's Stock Price Getting Out of Hand?

Everybody was talking about Twitter when the company went public. Apparently that's what you get when a company that is not only in one of the hottest subsectors today (social media) but also in the business of buzz itself goes public. But the hype hasn't seemed to to have faded -- the stock just keeps heading upward.

On the day of Twitter's IPO, the stock was initially priced at $26. It's been just over a month, and the stock is now trading at about $59. That gives the company about a $33 billion market capitalization. With no profits and just over $500 million in revenue, does Twitter really deserve this valuation? The company is even looking more expensive than Facebook . Is Twitter's stock in speculative territory?

In the video below, Fool contributor Daniel Sparks takes a look at Twitter's valuation.

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Fool contributor Daniel Sparks owns shares of Tesla Motors. The Motley Fool recommends Facebook and Tesla Motors. The Motley Fool owns shares of Facebook and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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