Twitter's valuation is in the eye of the beholder, Aswath Damodaran of the New York University Stern School of Business said Tuesday.

"I really think it depends on what you call yourself. If you're a trader, then all bets are off. You're betting on price," he said.

"If you're an investor and you think about value, I think at $20 billion, an awful lot has to go right for that $20 billion to be a break-even, forget about making money."

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On CNBC's "Fast Money," the valuation expert and professor of finance said that Twitter, which has suggested a valuation of $12.8 billion in its bid to go public, would be a "buy" at $10 per share, or a $6 billion market capitalization.

At a $10.5 billion market cap, or $14.50 per share, Twitter gets a rating of "neutral" from Damodaran. And at a $20 billion market cap, or as a $35 stock, Twitter was a "don't buy."

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"I'm a realist," he added. "I know that an IPO is a pricing game, that it's all about mood and momentum, and promise and potential. And everything's about multiples and comps. But I think we need to get a sense of the underlying reality here.

"My estimate is: To get a $10 billion value, they have to deliver about $12 billion in revenues in a decade. That's not easy to do."

— By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.