Facebook IPO

[themack89]

http://www.businessweek.com/news/2012-01-28/facebook-said-to-plan-its-ipo-filing-for-as-early-as-next-week.html

For those of you interested anyways.

[triplep]

looks like Morgan Stanely will be taking care of the underwriting, good luck trying to get any IPO shares... looks like when the shares hit the open market it might be a good time to buy some call options woot!

[in*10*se]

options aren't available for the first few weeks of trading due to the volatility FYI......

[dimi]

Another massively overvalued tech ipo. Could be worse, I mean GRPN is still just 20% under its IPO price.

[themack89]

Originally posted by dimi
Another massively overvalued tech ipo. Could be worse, I mean GRPN is still just 20% under its IPO price.

More of a future value thing.. The 'experts' are anticipating some pretty significant growth in a few of their revenue streams.

[sexualbanana]

I'm interested to see how the money raised is going to be used to fend off the competition

[kenny]

Lucky bastard...

http://www.dailymail.co.uk/news/article-2095385/Facebook-IPO-Graffiti-artist-David-Choe-painted-HQ-set-bumper-shares-payday.html

[Zephyr]

Originally posted by kenny
Lucky bastard...

http://www.dailymail.co.uk/news/article-2095385/Facebook-IPO-Graffiti-artist-David-Choe-painted-HQ-set-bumper-shares-payday.html

"I'm rich bitch!"

[Eleanor]

^ yeah, seriously :(

$200 million for graffiti? In Calgary you just get arrested, haha.

[Feruk]

Their IPO is only $5 Billion on $1 Billion in earnings. This'll be an easy way to make money.

[natejj]

Originally posted by Feruk
Their IPO is only $5 Billion on $1 Billion in earnings. This'll be an easy way to make money.

You know they aren't valuing the company at $5 billion, right? They are only listing like 5-10% of all the shares. FB is valued around $100 billion.

[cet]

Is it even going to be possible for the average Canadian to get IPO shares?

[Feruk]

Originally posted by natejj


You know they aren't valuing the company at $5 billion, right? They are only listing like 5-10% of all the shares. FB is valued around $100 billion.
Yeah I realized that after I wrote the message. :(

[skandalouz_08]

Originally posted by cet
Is it even going to be possible for the average Canadian to get IPO shares?

I think it will more depend how much money you have and the type of connections you have due to your money. The average investor wont get in on this IPO imo

[BigMass]

Originally posted by dimi
Another massively overvalued tech ipo. Could be worse, I mean GRPN is still just 20% under its IPO price.

… which produces nothing and it’s entire revenue stream is from advertising. The second Facebook stops being a fad and the “in thing”, company goes from making billions to making zero. Nothing lasts forever, TGLO v2.0

[BigMass]

yeah it's old but still... it's catchy
dr3qPRAAnOg

[Mar]

Someone was telling me the IPO won't be available to Canadians.

[broken_legs]

http://go.bloomberg.com/facebook-unleashed/2012-02-02/182901-ads-26-clicks-my-short-life-as-a-facebook-advertiser/

[Trinzler]

Man I can't believe that artist got a 200 million payday. God damn it :eek:

[ercchry]

so, today is the first day of trading. opened at 42, quickly dropped to 38 and now its quickly climbing (currently at 41)

[flipstah]

If I got it for mad cheap, I'd sell at ~$45-50/share and just ride off to the sunset.

I have a feeling it'll end up like AOL. I hope I'm wrong.

[tobslau]

It's overpriced....I think your feeling that it will end up like AOL is a very accurate guess haha.

[cloud7]

It is not worth $38... nevermind $41-42 that it's now trading at. The share price should be back to reality in a week or so.

[borN]

Can I ask your reasoning on why you think it's not worth $38? I'm really trying to grasp how people are placing a value on it. I doubt people are basing it off of fundamentals and there are no real direct comparables... I personally think most retail investors are clueless on how much this company is worth, and really is just placing a momentum bet on it.

[ercchry]

if google can be worth $620/share i dont see how facebook cant grow to at least 1/6th of that :dunno:

they need to show growth in revenue first though i think

EDIT: linked in is worth $100/share... i think facebook can do at least that :rofl:

[rage2]

Originally posted by borN
Can I ask your reasoning on why you think it's not worth $38? I'm really trying to grasp how people are placing a value on it. I doubt people are basing it off of fundamentals and there are no real direct comparables... I personally think most retail investors are clueless on how much this company is worth, and really is just placing a momentum bet on it.
Even when using the most optimistic valuation formulas based on revenue and growth, the company is not worth anywhere near the current valuation of $110b.

That and many believe that facebook has peaked and will flatline in terms of users. The valuation is partially based on future growth, which is way optimistic as well.

[rage2]

Originally posted by ercchry
if google can be worth $620/share i dont see how facebook cant grow to at least 1/6th of that :dunno:

they need to show growth in revenue first though i think

EDIT: linked in is worth $100/share... i think facebook can do at least that :rofl:
Uhh, the price per share is meaningless. FB and GOOG have completely different # of shares in total.

GOOG doesn't like to split. Neither does AAPL. Hence the retarded high share prices.

edit - if we theoretically split down GOOG and AAPL to the same # of shares as facebook, we have a stock price of $73.93 for GOOG and $182.82 for AAPL. Which means FB is currently trading at 55% of GOOG's stock price.

[max_boost]

http://boombustblog.com/blog/item/6076-as-i-promised-last-year-facebook-is-being-proven-to-be-overhyped-and-overpriced

[ercchry]

Originally posted by rage2

Uhh, the price per share is meaningless. FB and GOOG have completely different # of shares in total.

GOOG doesn't like to split. Neither does AAPL. Hence the retarded high share prices.

edit - if we theoretically split down GOOG and AAPL to the same # of shares as facebook, we have a stock price of $73.93 for GOOG and $182.82 for AAPL. Which means FB is currently trading at 55% of GOOG's stock price.

true, didnt realize how much more facebook had :nut:

so if goog had the same amount their price would be ~$75/share?

[JLau]

i am not touching it unless if is down to 30/share

[S-FLY]

If you guys think it's going down, short it. :)

[rage2]

Originally posted by ercchry
true, didnt realize how much more facebook had :nut:

so if goog had the same amount their price would be ~$75/share?
$73.93

LinkedIn does the same thing, low # of shares. So split down to the same # of shares as FB, it's $3.79 lol.


Originally posted by S-FLY
If you guys think it's going down, short it. :)
Too many emotional investors keeping the price up right now haha.

[EK 2.0]

Originally posted by rage2

Too many emotional investors keeping the price up right now haha.


This...

[borN]

Originally posted by rage2

Even when using the most optimistic valuation formulas based on revenue and growth, the company is not worth anywhere near the current valuation of $110b.

That and many believe that facebook has peaked and will flatline in terms of users. The valuation is partially based on future growth, which is way optimistic as well.

Oh yeah, I definitely acknowledge that. Maybe I'm just skeptical on tech stocks like these because there's just a huge unpredictability factor in them. Can we really determine growth rates and assume they won't be getting revenue streams from other sources in the future? I'm not an expert on this industry, but just speaking with other bankers who cover the tech sector, it sounds like their models are more sensitive to very minor assumption changes; in other words, cash flow models can be a very blind calculation.

The probability of a significant event for each tech company is huge compared to other industries...makes for some very wild valuations. Oh well - I'm surprised it's trading on par to its issue price!

[sputnik]

Originally posted by S-FLY
If you guys think it's going down, short it. :)


Originally posted by rage2
Too many emotional investors keeping the price up right now haha.

Long term, Facebook is an obvious short.

However the problem is how much available margin one has with their brokerage.

Now that they are public I can see Facebook being rumoured to acquire other companies or announcing new gadgets/partnerships. These could unjustifiably push the stock higher pushing those that short it out of margin space to be able to retain the short position.

I could see Facebook going from $40 -> $75 -> $20 within the next two years.

[spikerS]

Originally posted by rage2

Too many emotional investors keeping the price up right now haha.

My thoughts exactly. I think with the average Joe not being able to buy it right now, once they can, all these large brokerage firms will probably unload on mass to make their profits, letting the public take the loss.

[roopi]

Originally posted by sputnik

Long term, Facebook is an obvious short.

However the problem is how much available margin one has with their brokerage.


You can always look into LEAPS. They offer you the ability to short the stock via a put option for up to 3 years. Since it's an option it limits your potential loss as well.

Personally I agree with everyone that it is obviously overpriced at the moment and unless they figure out a way to generate revenue other than advertising this stock is going down.

[flipstah]

Originally posted by roopi


Personally I agree with everyone that it is obviously overpriced at the moment and unless they figure out a way to generate revenue other than advertising this stock is going down.

The only thing I can think of is Premium FB. :drama:

[roopi]

Originally posted by flipstah


The only thing I can think of is Premium FB. :drama:

:rofl: That was joke right? I can't many people paying to use this service at all.

Facebook has been aquiring companies however they aren't really adding any revenue. They spent 1 billion on Instagram which has no revenue. That's quite the investment for nothing.

[Isaiah]

Originally posted by roopi


:rofl: That was joke right? I can't many people paying to use this service at all.

Facebook has been aquiring companies however they aren't really adding any revenue. They spent 1 billion on Instagram which has no revenue. That's quite the investment for nothing.
If Zuck doesn't have a plan for that acquisition then he's the smartest dummy I know. If you believe that then you're the dumbest smartass I don't know.

[e36bmw///]

nm

[Isaiah]

@ e36bmw///

Valuation in Facebook's case is based on their userbase unlike the other companies you listed. If that diminishes due to an unforeseen circumstance, the company's 'value' vaporizes.

[flipstah]

Originally posted by roopi


Facebook has been aquiring companies however they aren't really adding any revenue. They spent 1 billion on Instagram which has no revenue. That's quite the investment for nothing.

Some shit will go down with Instagram... I just don't know what.

Either that or he just liked buying a 'company' for the sake of buying. :rofl:

[e36bmw///]

nm

[chkolny541]

anyone else get extreme pleasure watching this stock fizzle with no noticeable gain today

[acura_el]

Originally posted by chkolny541
anyone else get extreme pleasure watching this stock fizzle with no noticeable gain today

I did. Apparently Morgan Stanley spent over $2B propping up the stock so it wouldn't fall below $38 toward the end of the trading day.

It was overpriced and over-hyped; they really milked it for all it was worth and no upside was left for the retail investor once it actually started trading. A value of 107x earnings isn't anywhere near an appropriate valuation so it'll be interesting to see what Morgan Stanley does about this next week.

[cloud7]

Originally posted by acura_el


Apparently Morgan Stanley spent over $2B propping up the stock so it wouldn't fall below $38 toward the end of the trading day.


That was what the BNN folks were speculating when the share price went down to $38 from opening at $42 within 1/2 hour and then quickly went back up again. That more than the retail investors was what kept the price above $38 at the end of the day. Not touching FB... with the recent slump in the market, there are plenty of bargains out there.

[Supa Dexta]

Is this why zuckerberg got married a day after the stock hit? Assets before marriage are safe?

[flipstah]

Originally posted by Supa Dexta
Is this why zuckerberg got married a day after the stock hit? Assets before marriage are safe?

He wanted to celebrate. NO PRE-NUPS FOR ERRBODY!

[rage2]

Originally posted by Supa Dexta
Is this why zuckerberg got married a day after the stock hit? Assets before marriage are safe?
If he expected the $38 to be a stock's peak, then yes. Otherwise, all gains past $38.23 will be split 50/50 at this point. Common law is not recognized in California, so she gets nothing from before marriage.

She is Asian, so I can see him protecting himself from gold digging lol.

[rated_R]

Big drop in shares, 11% damn

[Maybelater]

lol byebye peoples money

http://i46.tinypic.com/r877h4.jpg

[flipstah]

Originally posted by rated_R
Big drop in shares, 11% damn

Short!

[S-FLY]

Originally posted by S-FLY
If you guys think it's going down, short it. :)

Should have taken my own advice, $32.19 and falling today.

[rage2]

There's restrictions on shorting FB. Too many ppl were doing it and it triggered a failsafe. :rofl:

[ercchry]

Originally posted by rage2
There's restrictions on shorting FB. Too many ppl were doing it and it triggered a failsafe. :rofl:

i guess people have been using other companies that hold shares as proxies to short FB

http://www.theglobeandmail.com/globe-investor/sec-finra-call-for-probe-of-facebook-ipo-as-stock-slides/article2439751/

[spikerS]

now that I know what shorting is, If I knew how to actually go about doing it, It would have been a sure bet! Watching it tumble was a sure thing. I see it tumbling down to the mid to low 20's personally. Take that with a grain of salt though as I know very little about the stock market.

[roopi]

Originally posted by rage2
There's restrictions on shorting FB. Too many ppl were doing it and it triggered a failsafe. :rofl:

I thought the only restriction was that they needed to wait 3 days until trades settled from the IPO day.

Was it actually possible to directly short FB on the first IPO day?

[barmanjay]

I'm not a stock guy (although my dad used to play stocks and commodoties)

My gut tells me it'll drop to $27ish, flatlineish, bump up to about $33ish.

But I know nothing,..

[rage2]

Originally posted by roopi
I thought the only restriction was that they needed to wait 3 days until trades settled from the IPO day.

Was it actually possible to directly short FB on the first IPO day?
This is on Monday's trade:

http://online.wsj.com/article/BT-CO-20120522-709396.html


Originally posted by barmanjay
My gut tells me it'll drop to $27ish, flatlineish, bump up to about $33ish.

But I know nothing,..
Well the initial valuation of the IPO was at 27ish to 33ish, so you know enough haha.

I still think that's on the high side. When their next quarterly earnings come out indicating once again no improvement, they're going to tank again. They've levelled off on users, they need to increase revenue per user, and there's been no solid plans to do so.

Their valuation is pretty ridiculous. I don't think it's a $110b business. IMO it's a $35b business, with $11b or so in the bank thanks to the inflated IPO, which would put the stock price between $16-$17. Of course, with so many stay at home investing moms wanting a piece of the stock, it'll never drop that low. Emotional trading will continue to prop it up in the low 20's when the dust settles.

Of course, if Facebook figures out the magic formula for increasing revenue per user, without pissing off users, then everything changes. There's no indication of it at all. If anything, Facebook has said that users are moving mobile, and they haven't figured out how to monetize mobile.

My guess on the whole situation.

[benyl]

Users going mobile is the biggest issue as there are no ads. I noticed that they started putting in "trending articles" in the news feed and that is starting to annoy me already. If they put in ads, I think they will lose a few people.

Also, I don't know about most people, but I almost never click on an ad. hehe

[guessboi]

+1 Ads on the net doesn't mean much to me either. lol.

[rage2]

There's ads on mobile, Apple has a whole iAds platform dedicated to it. It just brings in less $.

[benyl]

iAds works in facebook? I've never seen one.

[rage2]

What I meant was there are ads on mobile. But ya, facebook app does not have any ads. They probably don't want to give a slice of their revenue to apple, and trying to build their own ad service.

[S-FLY]

Closed the day @ $31.00

[e36bmw///]

nm

[roopi]

Originally posted by e36bmw///
Any idea when options will be available?

Expected date is May 29th

[Xtrema]

Originally posted by rage2
. Of course, with so many stay at home investing moms wanting a piece of the stock, it'll never drop that low. Emotional trading will continue to prop it up in the low 20's when the dust settles.

My 65 yr old almost illeterate aunt said she's buying. That usually a sure sign to stay out of FB. :rofl:

[rage2]

How about an 11 year old?

http://www.nypost.com/p/news/local/tuck_in_book_bind_N2IBnbMMxJBcjsp2SzoN2J

He should be happy, not pissed, that his order didn't go through. Just saved him $2k! lol

[JLau]

when it drops to about 20 bux i will probably buy

[Feruk]

IT companies with minimal physical assets need a strong earnings multiple to interest me (10X-20X). Facebook's got a way to go before I'd go long. On the other hand, with really no good business plan that I can see working to increase revenues, might be good for a short.

[arian_ma]

Originally posted by rage2

Of course, if Facebook figures out the magic formula for increasing revenue per user, without pissing off users, then everything changes. There's no indication of it at all. If anything, Facebook has said that users are moving mobile, and they haven't figured out how to monetize mobile.
That's some good insight. I have recently completely stopped using Facebook on my computers due to how annoying it has become. Even the mobile version with the trending articles like benyl said are starting to get to me. Now it's constantly asking me to install some messenger app?? Dayum, downhill slope

[barmanjay]

I don't know that advertising is going to be FB's big money maker?

What do you all think about all those FB games that require tokens? My better half just charged my paypal $10 for some kind of farmville tokens.

I think that is the direction FB will go. Not necessarily charge the user directly, but charge the app developer which will in turn charge the user.

Kind of a similar business model apple has with the i-products/apps.

Either way, if managed right, FB is a money maker in that respect.

Maybe $27 is too high? perhalps a $19-21 is a better valuation?

food for thought....

[kenny]

I agree FB's revenue growth will not be in display advertising. You can only stuff so many ads onto a page. They'll have to figure out another way to sell ads. My guess is they'll evolve their advertising platform so ads will come in the form of status updates from brand pages or they'll expand their system where you see more brands/products that your friend network has liked.

They need to build an App Store of some sort where they can sell apps for people to customize their facebook page. Top Paid App will be an app that allows you to keep the old FB look and feel as they overhaul the site every 6 months.

I imagine there will be a push from FB to get users to make more public status updates so they can sell that data (or maybe they can sell the private aggregate status updates already?)

[blitz]

But there's no way a FB App store would be worth enough to justify a $104b valuation. The Apple store has done something like $4 billion in gross revenue it's inception in 2008.

[Type_S1]

Does facebook charge companies to have company pages?

Not too sure...but if there was a monthly fee for companies it would also be good for revenue.

[flipstah]

Ouch.

http://www.cbc.ca/news/business/story/2012/05/23/facebook-ipo-stock.html

[spikerS]

Originally posted by Type_S1
Does facebook charge companies to have company pages?

Not too sure...but if there was a monthly fee for companies it would also be good for revenue.


GM said it will still have Facebook pages marketing its vehicles, but it will drop use of paid ads. Anyone can create a Facebook page at no cost. GM pays no fee to Facebook for its pages, which allow the automaker to reach consumers directly.

[thetransporter]

Investors started lawsuits, its become a mess.


Headline keywords:
IPO, goldman sachs, zuckerberg, insider tradding, lawsuits, overvalued, things got worse,

http://www.cnn.com

[atgilchrist]

Originally posted by Xtrema


My 65 yr old almost illeterate aunt said she's buying. That usually a sure sign to stay out of FB. :rofl:

This. I've had to tell more than a few clients to stay the hell away. Wait till its $12-$15.

[benyl]

Wow, down almost 10% today.

[flipstah]

It's like watching a train wreck unfold.

[JLau]

lets see when it drops below 20

[e36bmw///]

nm

[Isaiah]

Currently @ $26.36.

[supe]

Originally posted by Type_S1
Does facebook charge companies to have company pages?

Not too sure...but if there was a monthly fee for companies it would also be good for revenue.

I think this is the correct line of thinking FB should be on. Every company in the world should be on FB, it is an excellent communications tool to reach the masses. FB just has to find a way to capitalize on this need.

I don't think that FB can be viewed as a conventional company with typical accounting valuations. There is value in its user base which is growing especially with the younger generations which will be the future for FB.

[dj_patm]

Facebook could've really used a baby boom 13-14 years ago.

[HiTempguy1]

Originally posted by supe


There is value in its user base which is growing

Umm... you sure about that? I thought FB users had plateaued?

Besides that, the fact is, the company is only worth something if it can make money. The "prospect" of being able to make money that might materialize at "some point" is not good enough :dunno:

[msommers]

Originally posted by Isaiah
Currently @ $26.36.

:rofl:

Whoever thought that stock was going to up from its initial opening was definitely in one of two categories: Extreme risk or Strong prayer.

[benyl]

$25.90

[supe]

Originally posted by HiTempguy1

Besides that, the fact is, the company is only worth something if it can make money. The "prospect" of being able to make money that might materialize at "some point" is not good enough :dunno:

I'm sure Zuckerberg would laugh in your face.

[HiTempguy1]

Originally posted by supe


I'm sure Zuckerberg would laugh in your face.

Oh joy, one person got rich off an IDEA essentially.

I bet you could expand that to every single ripoff of a dotcom company in the early millennium would laugh in my face... the ones that screwed millions out of their savings/retirement funds. What is your point?

[supe]

My point is every single company in the world requires a user base, the trick is to somehow monetize that. FB has one of the largest user bases in the world which you seem to so easily dismiss.

BTW who did google screw over and lose their savings/retirement funds from? I love blanket statements.

[spikerS]

Originally posted by HiTempguy1


Oh joy, one person got rich off an IDEA essentially.

I bet you could expand that to every single ripoff of a dotcom company in the early millennium would laugh in my face... the ones that screwed millions out of their savings/retirement funds. What is your point?

quote from my favorite movie:


Sheriff: I've never met a rich man that didn't have a guilty conscious.
Wyatt Earp: I already have a guilty conscious, I might as well have the money too.

But to play devil's advocate here, if these "investors" can't afford to be loosing their life savings or retirement funds, they should not be gambling with them...

[HiTempguy1]

Originally posted by supe
My point is every single company in the world requires a user base, the trick is to somehow monetize that. FB has one of the largest user bases in the world which you seem to so easily dismiss.

BTW who did google screw over and lose their savings/retirement funds from? I love blanket statements.

Google is not a ripoff dotcom business. Many business started up, "borrowed" or had "invested" in them millions of dollars and then went tits up, taking that money with them.

I'm not saying they are evil, and I'm not saying people are stupid (@spikers). I'm just sayin' what I am sayin'; if Facebook was ACTUALLY worth something, it would be worth something.

HEY GUYS, REMEMBER MYSPACE? :banghead:

Facebook is (almost by extension) suffering from what current media does. People wanting something for free, and it being offered to them. I won't "pay" for Facebook. And if companies have to (for instance), they'll just stick with their websites and email.

[dj_patm]

If I were Facebook I'd run my own ads before any video someone shares. I would also charge businesses to start being included in "Where Are You" listing's and such.

No one will ever pay for Facebook.

[supe]

The only difference between Google and your so called "ripoff dotcom businesses" is that Google is successful. I see no difference between it and Facebook.

And Facebook is ACTUALLY worth something! Currently its worth 58 BILLION dollars! Even if its worth half of that its still worth more than 99% of all the companies in the world.

So what are you saying? To me all you are saying is you see the world half empty.

What I would want to talk about is what is the value of Facebook and where is the potential because its there!

[flipstah]

Originally posted by supe
The only difference between Google and your so called "ripoff dotcom businesses" is that Google is successful. I see no difference between it and Facebook.

And Facebook is ACTUALLY worth something! Currently its worth 58 BILLION dollars! Even if its worth half of that its still worth more than 99% of all the companies in the world.

So what are you saying? To me all you are saying is you see the world half empty.

What I would want to talk about is what is the value of Facebook and where is the potential because its there!

May I ask what that value is based on? I don't think pokes and 'likes' count as tangible assets.

[ZenOps]

Geocities was more memorable for me. They were worth about $3.6 Billion, 12 years ago, before they got absorbed by Yahoo (another .com that is tinkering on the edge of oblivion)