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Twitter has taken a lot of flack for its slow approach to revenue, but a new report pegs the startup’s annual revenue at $1.194 billion in five years.

A few days ago, we learned that the startup was on track for around $140 million in revenue for 2011. That number pales in comparison to, say, Facebook’s $4.27 billion projected revenue for the year.

However, we have to remember that the microblogging platform’s revenue-generating suite of ad products hasn’t even been fully rolled out yet. Saying the company’s revenue efforts are still in a “nascent stage,” secondary market SharesPost researchers stated, “We believe the company is still a year or two from fully monetizing all aspects of its platform.”

The new study released by SharesPost today shows that, in fact, Twitter’s revenue is projected to grow substantially once its group of promoted products is fully operational. The report estimates that Twitter will reach $329 million in revenue by next year and half a billion dollars in annual revenue by 2013, surpassing the $1 billion benchmark in 2016. These numbers are somewhat higher than, but still comparable to, estimates from ad intelligence firm eMarketer.

Twitter is reported to have made around $45 million in 2010, and between $140 million and $165 million in 2011.

However, SharesPost’s report does come with a critical caveat. Explaining that the promoted ad options are still relatively untested, the researchers wrote, “We believe that most revenue generation options available to the company have the potential to alienate at least some of Twitter’s user base. The company may not have adequate time to revise its models before it loses its critical mass and reputation… Promoted Tweets and Trends offer additional monetization options, but… is likely to turn off some users if the advertising gets too intrusive.”

This year, Twitter started ramping up its line of advertising products, which currently includes Promoted Tweets, Promoted Trends and Promoted Accounts. Just last month month, the company started serving promotional content in a new way altogether, allowing advertisers to push tweets to users even if those users don’t follow the advertiser’s account.

Another new source of revenue for the end of 2011 and the duration of 2012 will be political advertising. The company opened a Washington, DC-based ad sales office to gear up for a slew of political advertising over the next 13 months or so.

The report’s numbers are based on expected customer growth, the number of brands choosing to advertise through Twitter, revenue from existing advertising products and ad targeting. However, SharesPost did note that since Twitter’s revenue-generating features are still “in an experimental phase… it is not yet certain when Twitter will achieve this kind of ad targeting and attain its expected revenue growth.”

The report also indicated that Twitter is sitting at the top of the heap when it comes to return on investment for advertisers. Researchers pegged the cost per acquisition for Twitter ads at around $0.14 to $0.50 — a far cry from the multi-dollar per acquisition amounts seen in email marketing, mobile marketing or telemarketing.

As for valuation, the report reads, “Assuming steady state revenues of $1.195B in 2016, normalized net margins of 25 percent, a growth multiple of 25x, and discounting to 2011 at a discount rate of 20 percent, we arrive at a target 2011 enterprise value of $3.0B. Accounting for estimated cash in hand of $600M we arrive at a market capitalization of $3.6B.”

These numbers are significantly lower than reported valuations from a recent funding round (around $8 billion) and secondary market trading ($6.8 billion).

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