This Week in Your Wallet: Twitter is Going Public. Should You Buy In?
I’ve grown to love my Twitter account. Whether it’s for receiving news, sharing news, or getting a good laugh, it’s become a valuable resource for journalists and consumers alike — and I particularly like the way it helps me keep in touch with all of you. The social media brand made major headlines last week when it fittingly tweeted the company’s decision to file S-1 documents for an IPO. After seven years of success, and millions of users later, the private company is finally opening its doors to the public – slightly opening them, that is. You see Twitter is taking advantage of the relatively new SEC laws established under last year’s JOBS act, filing for its S-1 in secret. While this move allows Twitter to test the waters with major investors before becoming a publicly-traded company, it initially keeps the smaller investors, like us, in the dark. I’ve been enjoying Forbes’ coverage on the announcement, specifically its article comparing the company’s decision to Facebook’s IPO fiasco.
Twitter is not only filing at a younger age than Facebook did, but also with more room for growth in revenue and valuation. Both of these aspects are better for success in Wall Street, according to the article. However, like Facebook, this IPO’s dark period could result in misinterpretations and mistranslations for how the tech company will stand when its doors are wide open, not just cracked. For now, we’ll have to wait and see. If you want to read about what other industry experts are saying, check out this piece from Bloomberg on how it might come down to luck. Or this International Business Times article, which tells you five things to consider before investing.
And now, here are the other headlines for the week:
Lookout for price variations at drugstore chains:
We all know prices on the same products can vary between competitors, but did you know they could vary within the same chain? TIME highlighted a recent study released by the National Consumers League that revealed price inconsistencies on the same items within local chains. The League looked at 25 standard drugstore products at 485 Walgreens, CVS, and Rite Aid locations across the country. Walgreens turned out to have the greatest price jumps, according to TIME.
Walgreens spokesman Jim Graham released a candid statement to CNNMoney confirming the price differentiations, stating it’s a part of the corporation’s business model. “‘Costs can vary from one location to another, even when they are a few blocks apart in dense urban areas, based on the store’s cost of real estate, its hours of operation including whether it is open 24 hours, labor costs and the number of customers it serves each day, among other factors,’” Graham said.
Fair or unfair? Personally, it doesn’t work for me. After all, if a J.Crew sweater can be the same $79 on Madison Avenue in NY as it is in malls throughout the country, shouldn’t the same be true of Axe or Advil? I take away from this the lesson that it’s more important than ever to know what a fair price is for the things you buy frequently (I’m talking about you Chex and Charmin) and where you’re likely to get the best deals on what. This is the reason I load up on Ziploc bags at Costco once or twice a year, then shop my pantry til they run out. Meanwhile, if a price seems out of whack and you don’t feel like running to another store (Money Rule #52: A Sale Isn’t Worth the Drive if it Doesn’t Save You the Cost of Gas to Get There) look up the price across town on your smartphone and ask the manager to match it.
Financial scam reminders:
And while we’re discussing how tiring it is to be a consumer… CNNMoney wrote an article on five common scams that are contributing to an estimated total of $50 billion in financial losses per year. The article draws upon the findings from a recent survey that found “more than 8 in 10 consumers have received a “‘potentially fraudulent offer.’” Here are some good points to keep in mind:
- Foes from foreign countries. If you ever receive an email from someone in a different country wanting to do business with you by offering you money upfront, delete it pronto. Online scam artists are continuing to perfect their crafts. My friend’s daughter was recently looking for an apartment in New York City, and tried using Craigslist. Two different apartments she inquired about replied with well-drafted letters from international couples, telling her the apartment was hers if they received her personal information, like her social security and bank account numbers for a credit check. She did a little research, and discovered that these frauds have successfully scammed hundreds of other apartment hunters into complying with their requests.
- Stay away from penny stocks. It’s another one of those sounds-too-good-to-be-true scenarios that you should simply avoid. These extremely cheap stocks are often accompanied by fraudulent activities.
- Free lunches. As my father always said, there’s no such thing. Certain scamsters will invite you to a free, informational luncheon, where they’ll pitch investment opportunities that sound good in theory. Not to mention, you get a free turkey sandwich. CNNMoney correctly points out that all of their nice gestures are aimed to make you feel like giving back…by opening up your wallet.
I’d love to hear your thoughts on Twitter’s IPO, and any tips you’ve used to dodge dicey financial situations.
Have a great week!
Jean
