Shares of the social media giant soared in response, but that was just the start of the drama, as that “passive” part didn’t last long. 

On Thursday, April 14, Musk launched a hostile takeover bid for Twitter, revealing in an SEC filing his “best and final” offer of $43 billion, or $54.20 per share. The Tesla CEO says he wants to take Twitter private in order to ensure the platform stands for “free speech around the globe.”

“I believe free speech is a societal imperative for a functioning democracy,” Musk wrote Thursday in a letter to Twitter chairman Bret Taylor, according to an SEC filing. “However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.”

At the TED 2022 conference in Vancouver, shortly after announcing his Twitter bid, Musk added that the move is definitely “not a way to sort of make money.” But whether the world’s richest person is launching his takeover bid as a publicity stunt, to troll the Securities and Exchange Commission, or because he believes he can be an anticensorship white knight isn’t important to Twitter investors. 

For them, it’s a wild ride no matter the reasoning. And the move has left Wall Street analysts scrambling to predict what’s coming next.

In a note to clients on Thursday, Bank of America analysts, led by Justin Post, laid out three possible scenarios for how Musk’s takeover bid could move Twitter’s stock in the coming weeks—and one of them is unappealing for shareholders.

Scenario one

The first potential scenario Bank of America sees for Twitter: The board accepts the offer in its current form.

Analysts said they see this as a “lower-probability scenario,” as Twitter’s board likely sees more potential in the company based on internal growth targets and historical valuations. After all, Twitter stock has traded as high as $73.34 over the past 12 months.

The current offer is also “non-binding,” which means it will likely require financing, leaving “significant uncertainties,” the analysts said.

Other top Wall Street analysts argue Twitter is likely to accept the offer, however. Wedbush’s Dan Ives said he sees this “soap opera” ending with Musk owning Twitter.

“It would be hard for any other bidders/consortium to emerge and the Twitter board will be forced to accept this bid and/or run an active process to sell Twitter,” Ives wrote in a Thursday note.

But some analysts aren’t so sure. Jefferies’ Brent Thill said that he suspects Musk will have to reconsider his offer if he wants Twitter’s board to bite.

“No board in America is going to take that number,” Thill told Yahoo Finance. “Bring the bid to $60 and then put together a constructive structure around how they would run it. Then maybe, but that’s what it’s going to take.”

Scenario two

The second scenario, according to Bank of America, involves Twitter’s board rejecting the current offer and agreeing to a sweetened price with Musk or another firm.

In this scenario, stockholders could expect a roughly 10% jump in the final bid price to $60 per share, the analysts said.

“Mr. Musk has indicated that the $54.20 bid is final, but the board has a duty to explore all options for getting a higher price,” the analysts wrote. “Other social media or tech companies could be interested in Twitter.”

Thill said a deal with another tech firm is unlikely, however, due to antitrust regulation.

“The government is going to say no to any large transaction even if the rest of tech wanted to do this,” Thill explained. “It’s hard to see who the next logical player will be.”

Scenario three

The final scenario Bank of America analysts flagged was the board rejecting the current and any revised offers, forcing Musk to abandon his takeover attempt.

The move wouldn’t be surprising given reports by tech news site The Information that suggest Twitter’s board views the current offer as “unwelcome,” and is willing to fight either for a better deal or to stay public.

If this happens, BofA analysts said investors should expect Twitter’s stock to fall to between $34 and $37. Given the stock’s current price of around $45 per share, BofA said investors believe there is a serious possibility Musk walks away from his bid altogether.

“We think that the board likely believes that Twitter has more than $54/share in value,” the analysts wrote, but it must also evaluate the company’s potential to reach its 2023 financial targets.

That would be 315 million daily active users and $7.5 billion in revenue versus the 217 million daily active users and roughly $5 billion in revenue it had in 2021. “There will likely be extra scrutiny on hitting these targets if the board rejects Mr. Musk’s offer,” they added.