That's because those two social networking companies -- as well as other Internet upstarts whose bankers have sold IPOs in the last three years -- saw their shares fall sharply from their first-day closing price in the months after their offerings hit the market.
Retail investors who bought their shares after they'd already risen in their market debuts initially took big hits to their positions.
Those who bought Zynga and Groupon during their first day of public trading were given a permanent beat-down, unfortunately.
That's not to say Twitter's future sustainable growth rate is as weak as either of those two retail-investor disasters, which are still trading far below their IPO valuations.
Twitter has a shot at being among the leaders in the exploding market for mobile advertising sold on social media sites, even though the market is now dominated by Google and Facebook.
But with Twitter's IPO now officially 10 times oversubscribed, where is the near-term bid for Twitter shares supposed to come from once everyone gets their allotment?
Insiders know when to sell, and Twitter's offering -- like every IPO -- is the ultimate hand-off of risk and reward to professional fund managers and retail investors.
Moreover, recent history suggests buying an Internet stock on its first day of public trading can produce returns ranging from decent (LinkedIn) to disappointing (Facebook) to downright disastrous (Groupon and Zynga.)
One year after its May 18, 2012 debut, Facebook shares were 30% below $38, which was both their IPO price and the first-day's closing price.
During the same time, the broader market for tech stocks, represented by the Nasdaq Composite Index, rose 25%.
That's a disappointing return versus the market.
Facebook fi! nally recovered its IPO price this past July, but even with its recent gains, the stock is still underperforming a Nasdaq-indexed fund as a tech investment strategy.
Since its closing price on the first day of public trading, Facebook has gained 28% --well below the 42% gain in the tech-heavy index.
By contrast, those who waited for the froth to come out of Facebook are sitting on market-beating returns.
The scale of the Facebook offering was an order of magnitude larger than Twitter's IPO, of course, which is why LinkedIn's initial sale on May 19, 2011, may prove a more useful comparison.
LinkedIn shares, which have never traded below their $45 offering price, nevertheless spent months trading below the first-day closing price of $94.25.
One year after its IPO, LinkedIn had provided investors who bought at the higher price a return of about 10%, slightly outperforming the Nasdaq's roughly flat performance during that same time.
That's a decent return.
John Shinal, technology columnist for USA TODAY.(Photo: USA TODAY)
Meanwhile, those investors lucky enough to get LinkedIn shares at their IPO price are sitting on handsome profits.
The stock now has more than doubled, to $224, producing three times the 40% return in the Nasdaq during that same time.
The upshot of all this recent history?
Investors who can't get Twitter shares at their IPO price this week, and pay the public market price instead, could face an uphill climb to beat the returns of the broader tech market during the next 12 months.
John Shinal has covered tech and financial markets for 15 years at Bloomberg, BusinessWeek, the San Francisco Chronicle, Dow Jones MarketWatch, Wall Street Journal Digital! Network ! and others.
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