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Arian Foster goes public (1 Viewer)

Long Ball Larry said:
tdhartis said:
danielmclark said:
tdhartis said:
It's really not as crazy as it sounds. When you're investing in stocks, particularly in adolescent companies, you're invested in their long-term potential in most cases. Just as an injury can wreck the career of an NFL running back and leave him worthless in this scenario, you have your Enrons of the world. Also, think about the fiasco with the BP oil spill a few years ago. A lot of people bailed on the stock because they thought the company would never regain the ground it had lost. Others decided to stay in or "buy-low" once others had bailed, and they were rewarded when it rebounded. I imagine the same type of mechanics apply here. Let's look at a hypothetical:

Imagine Adrian Peterson signed a contract with this company in training camp prior to his first season. Coming into the league, some people were very high on him, and others were skeptical because of injury history, running style, whatever. Let's say these circumstances set a "share" of AP at $30. Fast-forward four years, and his perceived value has been confirmed, he is widely considered the best RB in the league, and has signed multiple lucrative endorsement contracts. His share price has skyrocketed to $90 at this point, and those that got in at the ground floor have realized a good deal of profit. Then comes 2011. He's riding high until he is placed on injured reserve for tearing his ACL and MCL, and a great deal of investors decide to jump ship before his stock falls too low. Will he ever come back the same player? Will he lose his endorsements? As a result of these fears, his share price plummets to $60 a share. Those that have stuck with him since the beginning and those that buy in at this level believe he will rebound, even if it is a risky venture. The next year their faith is rewarded, as AP bursts back onto the scene as good as ever, and his stock price jumps up to a new high of $95 by the end of the 2012 season.

I imagine that's how it would work. You're basically using knowledge you'd normally apply to some aspects of FF to make financial decisions. You think that nobody WR on the Giants whose stock is $5 a share has potential? You invest on the ground floor, and when said Victor Cruz goes off and signs a huge contract down the road you make off like a bandit. It's a pretty interesting concept, and I'll be following it closely.
Click to expand...
That's a great explanation, thanks. One thing still nags at me though... with companies, you expect them to continue to operate indefinitely. With players, there's a time limit - they will retire after a few years. Unless you're talking about someone on a level of Michael Jordan who continues to get endorsements after his career ends, the people holding "stock" in players will be left with nothing... so they'd have to sell before the player retired. But retirement is usually telegraphed a year or two in advance - how long ago did we know, or at least suspect, that this is probably Tony Gonzales' last year? And once rumors of a retirement date start surfacing, people will look to sell the stock... but who's going to buy?

I get that it's risky, and it actually does seem like an intriguing idea. This part of it is a little concerning. I sure wouldn't want to be holding $1000 worth of Arian Foster on the day he says he'll be retiring.
Click to expand...
That's a very good question. There would be a fire-sale when a player is obviously going to retire, and I'm not sure how they would deal with that. I would imagine that a players value and share price would slowly decline up to the point of retirement, and those getting out at the very end would be wise to not hold the entirety of their stock up to that point, but rather sell substantial chunks of it at different points in time to mitigate their risk. Knowing that you would likely take some hits when a player is near retirement if you hadn't cashed out at that point, you would try to factor that in during your original purchase. It would definitely be a scenario that would be hard to predict since stock markets don't have that element to them. Again, great question.
Click to expand...
You know that all companies are going to remain active indefinitely?

It really isn't all that different in principle than many other investments.
Click to expand...
Well, no, of course not. But the expectation is that they will continue to operate with no plan of stopping. With the players, there's no way for that to happen. Players have an... expiration date, if you will.

 
danielmclark said:
Long Ball Larry said:
tdhartis said:
danielmclark said:
tdhartis said:
It's really not as crazy as it sounds. When you're investing in stocks, particularly in adolescent companies, you're invested in their long-term potential in most cases. Just as an injury can wreck the career of an NFL running back and leave him worthless in this scenario, you have your Enrons of the world. Also, think about the fiasco with the BP oil spill a few years ago. A lot of people bailed on the stock because they thought the company would never regain the ground it had lost. Others decided to stay in or "buy-low" once others had bailed, and they were rewarded when it rebounded. I imagine the same type of mechanics apply here. Let's look at a hypothetical:

Imagine Adrian Peterson signed a contract with this company in training camp prior to his first season. Coming into the league, some people were very high on him, and others were skeptical because of injury history, running style, whatever. Let's say these circumstances set a "share" of AP at $30. Fast-forward four years, and his perceived value has been confirmed, he is widely considered the best RB in the league, and has signed multiple lucrative endorsement contracts. His share price has skyrocketed to $90 at this point, and those that got in at the ground floor have realized a good deal of profit. Then comes 2011. He's riding high until he is placed on injured reserve for tearing his ACL and MCL, and a great deal of investors decide to jump ship before his stock falls too low. Will he ever come back the same player? Will he lose his endorsements? As a result of these fears, his share price plummets to $60 a share. Those that have stuck with him since the beginning and those that buy in at this level believe he will rebound, even if it is a risky venture. The next year their faith is rewarded, as AP bursts back onto the scene as good as ever, and his stock price jumps up to a new high of $95 by the end of the 2012 season.

I imagine that's how it would work. You're basically using knowledge you'd normally apply to some aspects of FF to make financial decisions. You think that nobody WR on the Giants whose stock is $5 a share has potential? You invest on the ground floor, and when said Victor Cruz goes off and signs a huge contract down the road you make off like a bandit. It's a pretty interesting concept, and I'll be following it closely.
Click to expand...
That's a great explanation, thanks. One thing still nags at me though... with companies, you expect them to continue to operate indefinitely. With players, there's a time limit - they will retire after a few years. Unless you're talking about someone on a level of Michael Jordan who continues to get endorsements after his career ends, the people holding "stock" in players will be left with nothing... so they'd have to sell before the player retired. But retirement is usually telegraphed a year or two in advance - how long ago did we know, or at least suspect, that this is probably Tony Gonzales' last year? And once rumors of a retirement date start surfacing, people will look to sell the stock... but who's going to buy?

I get that it's risky, and it actually does seem like an intriguing idea. This part of it is a little concerning. I sure wouldn't want to be holding $1000 worth of Arian Foster on the day he says he'll be retiring.
Click to expand...
That's a very good question. There would be a fire-sale when a player is obviously going to retire, and I'm not sure how they would deal with that. I would imagine that a players value and share price would slowly decline up to the point of retirement, and those getting out at the very end would be wise to not hold the entirety of their stock up to that point, but rather sell substantial chunks of it at different points in time to mitigate their risk. Knowing that you would likely take some hits when a player is near retirement if you hadn't cashed out at that point, you would try to factor that in during your original purchase. It would definitely be a scenario that would be hard to predict since stock markets don't have that element to them. Again, great question.
Click to expand...
You know that all companies are going to remain active indefinitely?

It really isn't all that different in principle than many other investments.
Click to expand...
Well, no, of course not. But the expectation is that they will continue to operate with no plan of stopping. With the players, there's no way for that to happen. Players have an... expiration date, if you will.
Click to expand...
On their playing days, sure. But say Foster goes out with 40M saved and turns that into 250M over his 30's-60's? If you hold stock in his future earnings...Think of it as a company whose value is almost entirely predicated on a patent they have that will expire in 3 years. There is still tons of value during the patent and the company will have a chance to evolve their product/service line.

 
Last edited by a moderator:
mr roboto said:
danielmclark said:
Long Ball Larry said:
tdhartis said:
danielmclark said:
tdhartis said:
It's really not as crazy as it sounds. When you're investing in stocks, particularly in adolescent companies, you're invested in their long-term potential in most cases. Just as an injury can wreck the career of an NFL running back and leave him worthless in this scenario, you have your Enrons of the world. Also, think about the fiasco with the BP oil spill a few years ago. A lot of people bailed on the stock because they thought the company would never regain the ground it had lost. Others decided to stay in or "buy-low" once others had bailed, and they were rewarded when it rebounded. I imagine the same type of mechanics apply here. Let's look at a hypothetical:

Imagine Adrian Peterson signed a contract with this company in training camp prior to his first season. Coming into the league, some people were very high on him, and others were skeptical because of injury history, running style, whatever. Let's say these circumstances set a "share" of AP at $30. Fast-forward four years, and his perceived value has been confirmed, he is widely considered the best RB in the league, and has signed multiple lucrative endorsement contracts. His share price has skyrocketed to $90 at this point, and those that got in at the ground floor have realized a good deal of profit. Then comes 2011. He's riding high until he is placed on injured reserve for tearing his ACL and MCL, and a great deal of investors decide to jump ship before his stock falls too low. Will he ever come back the same player? Will he lose his endorsements? As a result of these fears, his share price plummets to $60 a share. Those that have stuck with him since the beginning and those that buy in at this level believe he will rebound, even if it is a risky venture. The next year their faith is rewarded, as AP bursts back onto the scene as good as ever, and his stock price jumps up to a new high of $95 by the end of the 2012 season.

I imagine that's how it would work. You're basically using knowledge you'd normally apply to some aspects of FF to make financial decisions. You think that nobody WR on the Giants whose stock is $5 a share has potential? You invest on the ground floor, and when said Victor Cruz goes off and signs a huge contract down the road you make off like a bandit. It's a pretty interesting concept, and I'll be following it closely.
Click to expand...
That's a great explanation, thanks. One thing still nags at me though... with companies, you expect them to continue to operate indefinitely. With players, there's a time limit - they will retire after a few years. Unless you're talking about someone on a level of Michael Jordan who continues to get endorsements after his career ends, the people holding "stock" in players will be left with nothing... so they'd have to sell before the player retired. But retirement is usually telegraphed a year or two in advance - how long ago did we know, or at least suspect, that this is probably Tony Gonzales' last year? And once rumors of a retirement date start surfacing, people will look to sell the stock... but who's going to buy?

I get that it's risky, and it actually does seem like an intriguing idea. This part of it is a little concerning. I sure wouldn't want to be holding $1000 worth of Arian Foster on the day he says he'll be retiring.
Click to expand...
That's a very good question. There would be a fire-sale when a player is obviously going to retire, and I'm not sure how they would deal with that. I would imagine that a players value and share price would slowly decline up to the point of retirement, and those getting out at the very end would be wise to not hold the entirety of their stock up to that point, but rather sell substantial chunks of it at different points in time to mitigate their risk. Knowing that you would likely take some hits when a player is near retirement if you hadn't cashed out at that point, you would try to factor that in during your original purchase. It would definitely be a scenario that would be hard to predict since stock markets don't have that element to them. Again, great question.
Click to expand...
You know that all companies are going to remain active indefinitely?

It really isn't all that different in principle than many other investments.
Click to expand...
Well, no, of course not. But the expectation is that they will continue to operate with no plan of stopping. With the players, there's no way for that to happen. Players have an... expiration date, if you will.
Click to expand...
On their playing days, sure. But say Foster goes out with 40M saved and turns that into 250M over his 30's-60's? If you hold stock in his future earnings...Think of it as a company whose value is almost entirely predicated on a patent they have that will expire in 3 years. There is still tons of value during the patent and the company will have a chance to evolve their product/service line.
Click to expand...
A very good point. Thanks!

 
Can you imagine how some crazy fans/investors are going to react when a player tanks.....this could get real ugly and unsafe for players.

 
I'm sure this doesn't include income from his outside investments.

There is no way he's clearing 50+ million in income going forward.

Cool idea but awful valuation for Foster. Would be nice to be able to short his stock.

 
Can you short stocks on this or not? I can't tell from their website.

I would, with high confidence, roll my 401K over there to short Foster @ $10, assuming I didn't have to cover for a decent length of time.

 
I agree, but I seriously doubt they will let you short. Their business model looks built on raising the players value, and they are going to want other athletes to sign on.

Their valuation is horrible, the question is how much can they sell based on the novelty alone, $10 to own a piece of an athlete.

I suspect they are also counting on the value becoming self fulfiling. How many that buy stock will also buy a jersey or other Foster products? lets not forget how dumb the average Joe is. How much will his endorsement value rise just due to the extra publicity his public offering brings?

 
(HULK) said:
Can you short stocks on this or not? I can't tell from their website.

I would, with high confidence, roll my 401K over there to short Foster @ $10, assuming I didn't have to cover for a decent length of time.
Click to expand...
Yeah, I'd apply for credit just to short this dog.

 
Grace Under Pressure said:
11 yards rushing and a hammy last week and the guy does his IPO now?
Click to expand...
The whole thing is a sham, nobody is going to invest any significant money in this.

It's kind of like buying stock in the packers, people just do it for the novelty, it's not an investment.

I'd say there is close to zero chance they raise anything close to the 10 million valuation.

 
I wouldn't bet against them. There was an outfit a few years ago that did something somewhat similar, only that outfit didn't have any earnings bUy in with the athletes. They just made up fake stocks and started selling them. People were investing hundreds of dollars into those things even though the only way to make momey was to hype the whole idea and sell them to new suckers hoping to do the same thing. The one left holding the bag at the end had nothing more than a digital certificate saying they owned absolutely nothing. And then when the site went under they didn't even have that.

In this case, there is at least a tangible asset behind the concept. It wouldn't surprise me if this thing took off for a while. Shorting it based on the assumption that people aren't stupid seems like a risky bet. In fact, probably getting in on the ground floor and immediately selling would be the way to go but since they are limiting purchases of stock even that's not a good play. My guess is that the guys that came up with the idea make out like bandits and several athletes do well too initially.

 
Houston Texans RB Arian Foster's back injury is worse than the back injury he dealt with during training camp. Foster is currently dealing with a lumbar issue in his back.

So what's his stock value now?

 
RUSF18 said:
No one has bought anything yet. Looks like they never will.
Click to expand...
If someone is going to do this it should be a young player on their rookie contract. I'll take some Andrew Luck stock please.

 
Last edited by a moderator:
Ian Rapoport @RapSheet


The #Texans will announce the move to put Arian Foster on Injured Reserve on Monday. It is a lumbar issue.
 
I still lol when I think about how heated arguments got between the "something's not right with Foster, look at his workload and his decreasing production, he's due to break down" crowd and the "you are an idiot, he's the perfect FF RB if you don't draft him you are a stupid head"...and then Foster did nothing but break down constantly all season, and now has a blown transmission.

 
ESPN NFL - Texans RB Arian Foster to have back surgery, miss rest of season, sources tell ESPN

 
pantherclub said:
bleachercreacher said:
pantherclub said:
This my friends is why you don't draft running backs in the first round of fantasy.
Click to expand...
This has nothing to do with drafting RB's in the first.
Click to expand...
of course it does, Running backs, especially ones ridden hard like Foster, are an incredible risk in the first
Click to expand...
Calvin Johnson missed a game, Dez Bryant is dealing with a back injury, Jimmy Graham has a foot injury, Julio Jones is out for the year, AJ Green missed preseason games, Gronk missed significant time, Aaron Rodgers is out for 4-6 weeks, and Peyton got nicked in the Colts game. The list goes on. There are many reasons to/to not draft a RB in the first, but injury isn't one of them. Everyone is an injury risk, these guys play football.

 
Dude was hoping to cash in big one last time before being put out to pasture. His best years are in the past.

 
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