bagger
Footballguy
then again if you used fundamental analysis you would have never bought FB in the first place.
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Facebook IPO thread (1 Viewer)
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Maelstrom
Footballguy
I've said this before, but Twitter and Facebook really have 2 different use cases. Twitter is for quick, short messages, mini-updates, meetups, stuff like that. Facebook is for connecting with family and friends, updating people on status, posting pics, stuff like that. While they seem similar because you can post a status message on both, realistically, most people don't abandon Facebook for Twitter or visa-versa.
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Twitter is more for gathering information whereas Facebook is more about stalking.I use twitter every day to keep updated on stocks, sports,, Kim kardashian, etc. Facebook has zero appeal to me.
I like you a lot MT, but some of your analogies lately have been awful.
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Cliff Clavin
Footballguy
Uh, yeah? I know they're different.
That analogy understated my point because sometimes you won't want to buy oranges even if they're a major bargain just because you're already too full. Oranges will rot, after all.I'll try to make the point a different way. Facebook stock is worth a certain amount based on its net assets, projected earnings, etc. If you're considering buying some, you should try to figure out exactly what it's worth. If its market price is above what it's worth, you should not buy any (and should possibly sell if you already have some). If its market price is below what it's worth, you may want to buy some (and should not sell unless you need the money).'humpback said:
Assume for a moment that the company's net assets, projected earnings, etc. remain constant in the short term. Suppose the price drops from 30 to 25. That is never, in itself, a sell signal. If you were going to sell at 25 because its value is lower than that, you should have already sold at 30. If anything, the price movement is a buy signal: if you put its value at 27, it just went from being overpriced to underpriced.
Obviously, it may not be true that the company's projected earnings have remained constant. Maybe something happened to lower forecasts. In that case, all bets are off and you have to reevaluate what the stock is worth. But that's due to outside factors, not the drop in its stock price. The drop in stock price, in and of itself, can never be a sell signal. In and of itself, holding everything else constant, a drop in price makes the stock a better buy (and a worse sell) than it used to be.
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Maude
Footballguy
Just an observation, I've seen more mention of Twitter on TV than I have for FB. The little "check us out on Twitter" ads seem to outnumber the FB ones. I'm just sayin'.
I generally agree, although I'd point out that the fundamentals are constantly changing. I interpreted what Shader wrote to be that he thinks the fundamentals of FB aren't good, so he should stop throwing good money after bad. What you said is true, but as you know, just because the price is lower doesn't make it a good buy either. I could be wrong, that may not have been what he meant.In any event, it was the analogy that I took issue with (on top of the others in the other thread). It's comparing, well, stocks and oranges.
Short Corner
Footballguy
And the supply is going way up in a few more weeks.
shader
Footballguy
Mr. Pickles
Footballguy
Major
Footballguy
pretty sure I mentioned it when this thing was priced but a combination of Second Market and Zuck not understanding the difference between real demand and fluff numbers. A 10% order from Fidelity @ 32>>>>>10% market order from Maverick or SAC......this is a complete and utter disgrace for the ECM guys at MSDW who took the fee instead and caved into mgmt instead of doing what was best for the stock on public markets. The $38/per share valuation was made on an inflated private market number that the FB team tried to make good on.
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Exactly - FB's job at the ipo was to get maximum dollar, not sell it cheap so the shareholders get all of the gain.
Major
Footballguy
Not if the stock will tank and alienate everyone that bought at IPO price and then lost their ###. You want the stock to reward those shareholders that bought the IPO. Ideally 10-20% premium that trades steadily and exercise the greenshoe without any major hiccups. This is what happens with a successful IPO that is priced right. Not gouge retail investors and reward hedge funds that just want to flip the stock for a quick buck.FB has really tarnished their image in many regards and MSDW has really looked bad as has NASDAQ. Really just a complete and utter #### show behind the scenes.
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Major
Footballguy
You have a lot to learn
CletiusMaximus
Footballguy
As long as the issuer doesn't disclose misinformation, conceal material information and the like, or otherwise run afoul of securities laws. Generally when an IPO is overpriced it is the underwriters who have a problem, and that's more of a business issue with their customers than a legal problem.
Facebook is going to have a tough time ever hitting the capital markets again with this mindset. I'm sure all the employees with their wealth tied to FB stock are in no way disgruntled either.
Abraham
Footballguy
Maybe, but not about this. Facebook wanted to get as much as possible at ipo. It worked. Zuck was very clearly not interested in courting investors but they bought in anyway. Good for him. And remember that despite the grousing of various parties, no one has lost more on the stock than zuck himself.
Maude
Footballguy
ouch!
Sarnoff
Footballguy
Yes, in a separate thread.
Disagree completely.Facebook will be able to issue stock in the future, if they so choose. They may have to be a bit more conservative in their approach, but assuming a fair valuation, institutional investors will get in.Employees now (or soon will) have a market to cash in their shares. How have the employees been harmed, if the IPO had been priced @$20? At the end of the day the shares are worth what the public is willing to pay for them.Really this was as much about greed from the underwriters who overestimated the worth of the stock, and overestimated the public's emotional willingness to buy the stock - to create the initial pop/profit.If I had owned shares prior to the IPO, I would want the company to get maximum value for the shares - that adds value to the company, and by extension, me.
Zuck was looking for a cash infusion. He still controls the company and is no danger of a shareholder revolt.
Maude
Footballguy
I believe employees can cash in their shares on August 16th. I would imagine there will be a mss sell-off. That, combined with more shares offered by FB, will likely further devalue the stock in cthe coming months.I sense another bubble bursting in the near future.
Maelstrom
Footballguy
Sorry, I know the quoting makes it seem like I was responding directly to you, but it was a more general posting about the two.
djmich
Footballguy
Why is it that investors need to be compensated 10% for buying a stock in the morning and selling at the end of the day? Why is that money not better served in Facebooks coffers.
Mario Kart
Footballguy
Not sure if you're confused but I am from the post by Major. IPO's are supposed to go up to allow the investors a quick buck? Never heard that before. An IPO is just like buying any other stock... it's a risk. Hell, if I knew all IPO's were supposed to get at least a 10% return by nightfall, I would have put all my money into it... quick 10%, right?
It's a balancing act. Ideally, they want the stock to appreciate some from the IPO price. That gives most of the money from the IPO to the company, but also leaves some for the investors. If the investors make money on an IPO, there is likely to be more demand for future IPOs, which is good for those companies going public and the underwriters. Too much appreciation means you left money on the table for the company, a loss means you're going to have gun-shy investors.
Mario Kart
Footballguy
I Googled "IPO busts" and looked at a few of the articles. Tech stocks have not done well overall the last couple years. However, like I said, any stock is a gamble. Doesn't matter if its an IPO or not and especially no 10% gain on the first day as a normality.
They weren't. The underwriters, the companies planning on going public in the future, and the investors who may participate in those IPOs, do care. FB also cares about issuing additional stock in the future.Why was Facebook supposed to care About the iPos of other companies in the future?
Of course there are risks, and I'm not saying a 10% first day gain is or should be a normality. Just pointing out that they do try and leave a little for the investors of the IPO, although it obviously doesn't always work out that way. It's good business.
krista4
Footballguy
This and others by you are great postings. There's an incredible misunderstanding of IPOs in this thread. Having been on the inside of a large number of them, it is absolutely a huge issue for companies going public to look for an IPO bump, and at the very least not a huge drop. There are a myriad of issues relating to this, from SEC issues to employee morale to secondary offerings. Almost any company in this situation is going to issue a huge amount of stock/options at the time of the IPO when they put a new equity plan in place, and certainly employee incentives at that level are now going to be way off. Again huge issues with secondaries and SEC, difficult earnings calls and analyst reports, increased shareholder proposals and pressure, opening yourself to corporate raiders, etc. While there is a push to get the offering price at the high end of a range, it is basically every IPO company's worst nightmare to see this happen and is heavily discussed in every IPO situation.They weren't. The underwriters, the companies planning on going public in the future, and the investors who may participate in those IPOs, do care. FB also cares about issuing additional stock in the future.Why was Facebook supposed to care About the iPos of other companies in the future?
Major
Footballguy
humpack - let Johnny Retail investor think he or she knows whats best for the stock/ issuing company. Ignorance is bliss.
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urbanhack
Fight The Power!
Peens, Jim11, meatwad & co.'Slapdash said:
SacramentoBob
Footballguy
What % of FFAers are undesirable?Peens, Jim11, meatwad & co.'Slapdash said:
urbanhack
Fight The Power!
44.75%What % of FFAers are undesirable?Peens, Jim11, meatwad & co.'Slapdash said:
Fennis
Footballguy
maybe more44.75%What % of FFAers are undesirable?Peens, Jim11, meatwad & co.'Slapdash said:
Does that include aliases?44.75%What % of FFAers are undesirable?Peens, Jim11, meatwad & co.'Slapdash said:
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