We will see. i don't know anyone wanting to buy at those crazy prices, but i'm in my mid-30's.i doubt the 20 somethings buying 10-100 shares can run things too high when there will be big institutions dumping tons of shares like crazy if it hits 50+.Basically you're saying there are enough ignorant young facebook fans who will buy it at any price, unfortunately the people dumb enough to invest like that don't have much money to buy more then a few token shares.
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Facebook IPO thread (2 Viewers)
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Major
Footballguy
It won't hit $70. Take a deep breath moderated. I am here so your confidence in the human race can continue.
Dr. No
Footballguy
you are probably right, but for argument's sake what will it hit?
Major
Footballguy
It really depends on what it prices at and how much they float. Right now, I'd put my money on $50-55 but I really have no sense on the quality of the book or what price big money (Fidelity, etc) is comfortable at purchasing.
Dr. No
Footballguy
The highly anticipated IPO for Facebook (Nasdaq: FB) IPO is expected to price tonight. Latest indication suggest it will price at $38 per share, which is the top end of the recently revised range of $34-$38.
TRADING:
Shares will be opening on the NASDAQ under the symbol "FB." Nasdaq IPOs tend to open a little later in the day then NYSE and recent IPOs on the exchange have been opening between 10AM-11AM ET.
OFFER SIZE:
The number of shares being sold in the deal will be 421,233,615 shares, which was recently raised recently from 337,415,352 shares as more insiders opted to selling into the offering.
SHARES OUTSTANDING:
There will be 2.14 billion total Class A and Class B shares outstanding following the offering. Including options, the total can be pushed to 2.64 billion. In addition, some 63,185,042 shares can be sold if the underwriter over-allotment is exercised. This brings an ‘all-in’ total to about 2.7 billion.
VALUATION:
At $38 per share, this could bring the market valuation to $103 billion. This would be the highest value ever assigned to an IPO. The offering size of $18.4 billion will make it second to Visa’s (NYSE: V) $19.65 billion 2008 IPO.
UNDERWRITERS:
The main underwriters for the offering are top dogs Morgan Stanley (NYSE: MS), JPMorgan (NYSE: JPM) and Goldman (NYSE: GS). A host of others are also helping.
LOCK-UP:
For the IPO lock-up, 268 million shares will be available to be sold 91 days after the IPO, another 137 million 151-180 days after, 1.22 billion 181 days after, 124 million 211 days after and 47 million 366 days after. There will also be additional stock available for sale from option granted to former employees.
USERS:
Looking at users, Facebook said it has 901 million monthly active users (MAUs) as of March 31, 2012, up 33% from last year. The company has 526 million daily active users (DAUs) on average in March 2012, an increase of 41%. It gets 3.2 billion likes and comments per day, 300 million photo uploads and has 125 billion friendships.
FINANCIALS:
Looking at financials, the company posted revenues of $1.058 billion for the quarter ended of March 31, 2012, up 45% from last year. Net income was $205 million for the quarter ended of March 31, 2012, down from the $233 million posted in the same quarter last year.
For the year ended December 31, 2011, revenue was $3.711 billion up 88 percent from last year. Net income was $1 billion, up 65 percent from last year.
VALUATION:
At a $103 billion valuation, the company is trading at 28x last year’s revenues and 103x last year’s net income.
If the company earns 65 percent more this year than last year then expect net income of $1.65 billion this year. On a per share basis this will be $0.61 per share. At $38, this would create a forward PE ratio of 63x.
OPINION:
One overlooked fact in the Facebook IPO is that unlike any other IPO in history, Facebook has created an entire cottage industry that traded its stock pre-IPO. The benefit of an IPO is the 'liquidity premium'. However, the liquidity in Facebook was already there pre-IPO due to the secondary exchanges. Also, the valuation was being set on almost on a daily basis - another thing that could limit the upside.
Give the valuation premium already granted to the company, the fact is it needs to "grow" into its already high valuation.
In addition to the liquidity premium already existing, it is pretty clear that the company may be trying to keep a lid on the upside – seemingly trying to avoid a one day pop then crash. By raising the offering size 25 percent recently, this suggest that the company is trying to keep up with the massive demand.
All this being said, it would not be crazy for the stock to pop 25% tomorrow. We see the IPO popping 10-20% upon the open and then fading and settling into a valuation around $90-$120 billion until we get some solid growth numbers.
TRADING:
Shares will be opening on the NASDAQ under the symbol "FB." Nasdaq IPOs tend to open a little later in the day then NYSE and recent IPOs on the exchange have been opening between 10AM-11AM ET.
OFFER SIZE:
The number of shares being sold in the deal will be 421,233,615 shares, which was recently raised recently from 337,415,352 shares as more insiders opted to selling into the offering.
SHARES OUTSTANDING:
There will be 2.14 billion total Class A and Class B shares outstanding following the offering. Including options, the total can be pushed to 2.64 billion. In addition, some 63,185,042 shares can be sold if the underwriter over-allotment is exercised. This brings an ‘all-in’ total to about 2.7 billion.
VALUATION:
At $38 per share, this could bring the market valuation to $103 billion. This would be the highest value ever assigned to an IPO. The offering size of $18.4 billion will make it second to Visa’s (NYSE: V) $19.65 billion 2008 IPO.
UNDERWRITERS:
The main underwriters for the offering are top dogs Morgan Stanley (NYSE: MS), JPMorgan (NYSE: JPM) and Goldman (NYSE: GS). A host of others are also helping.
LOCK-UP:
For the IPO lock-up, 268 million shares will be available to be sold 91 days after the IPO, another 137 million 151-180 days after, 1.22 billion 181 days after, 124 million 211 days after and 47 million 366 days after. There will also be additional stock available for sale from option granted to former employees.
USERS:
Looking at users, Facebook said it has 901 million monthly active users (MAUs) as of March 31, 2012, up 33% from last year. The company has 526 million daily active users (DAUs) on average in March 2012, an increase of 41%. It gets 3.2 billion likes and comments per day, 300 million photo uploads and has 125 billion friendships.
FINANCIALS:
Looking at financials, the company posted revenues of $1.058 billion for the quarter ended of March 31, 2012, up 45% from last year. Net income was $205 million for the quarter ended of March 31, 2012, down from the $233 million posted in the same quarter last year.
For the year ended December 31, 2011, revenue was $3.711 billion up 88 percent from last year. Net income was $1 billion, up 65 percent from last year.
VALUATION:
At a $103 billion valuation, the company is trading at 28x last year’s revenues and 103x last year’s net income.
If the company earns 65 percent more this year than last year then expect net income of $1.65 billion this year. On a per share basis this will be $0.61 per share. At $38, this would create a forward PE ratio of 63x.
OPINION:
One overlooked fact in the Facebook IPO is that unlike any other IPO in history, Facebook has created an entire cottage industry that traded its stock pre-IPO. The benefit of an IPO is the 'liquidity premium'. However, the liquidity in Facebook was already there pre-IPO due to the secondary exchanges. Also, the valuation was being set on almost on a daily basis - another thing that could limit the upside.
Give the valuation premium already granted to the company, the fact is it needs to "grow" into its already high valuation.
In addition to the liquidity premium already existing, it is pretty clear that the company may be trying to keep a lid on the upside – seemingly trying to avoid a one day pop then crash. By raising the offering size 25 percent recently, this suggest that the company is trying to keep up with the massive demand.
All this being said, it would not be crazy for the stock to pop 25% tomorrow. We see the IPO popping 10-20% upon the open and then fading and settling into a valuation around $90-$120 billion until we get some solid growth numbers.
Major
Footballguy
Yep, I mentioned this earlier. That's why I think $45 is the magic number but I think it could go as high as $55. Once my banker folks give me the scoop tonight, I'll have a better handle on it. Point being, don't buy on the first day unless you get stock at issue price. You'll likely get burned.
Mystery Achiever
Footballguy
A couple of analysts, who already have Buy recommendations out, both have $45 targets. I think one is Wedbush.
Mystery Achiever
Footballguy
Chase Stuart
Footballguy
Actually very, very funny.http://www.borowitzreport.com/2012/05/17/a-letter-from-mark-zuckerberg/I am a fan of both angry birds and imaginary sheep.
Major
Footballguy
Actually very, very funny.http://www.borowitzreport.com/2012/05/17/a-letter-from-mark-zuckerberg/
Thanks for posting. Effing hilarious 
Don't Noonan
Footballguy
I would be estatic if it opened above $48 tomorrow and would be looking to take profits. Retail demand is out of control so I would be very surprised if it didn't open up positive.
today, FB
Mystery Achiever
Footballguy
Congrats! Timing has to do with how your broker handles, I guess. Schwab gives until 7am to affirm your shares and allocates after that. I don't think I've, in the past, been notified until closer to market open. FB isn't due to open and start trading until 11 am.OK guys, looks like IPO shares just started hitting brokerage accounts. Saw in ETrade I got 50 of the 100 I ordered @ 38/share.
Mystery Achiever
Footballguy
I am in shock. Asked for 400 shares... and got them!
Very happy, but this may mean demand is less frenzied than expected, impacting the size of the opening bump. CNBC saying retail may have gotten 25% of the deal.
Very happy, but this may mean demand is less frenzied than expected, impacting the size of the opening bump. CNBC saying retail may have gotten 25% of the deal.
I am sort of worried here, I bought a block of 1,000 with the thought of not getting them, due to demand. The fact I got them has me worried that demand is not what we all might be thinking. I think $38 is still low, buit what I think doesn't really matter. I guess we will find at around 11:00 what is the direction.
mquinnjr
Footballguy
I am hoping the demand is Joe Blow investor hammering the market in less than 10 minutes here. We shall see, Bloomberg TV saying they're hearing traders saying it could start anywhere from $50-70 per share.
Mystery Achiever
Footballguy
So, we are thinking alike, toadstool. Who would have thought I was too conservative with my 400 sh request? I think, though, that there are still a lot of retail investors without shares because they did not qualify to request them (based on account size, account goals or whatever criteria applied) vs. just not getting an allocation. Agree, though, there may not be a cazy jump, which is okay. I am not planning to flip.
bicycle_seat_sniffer
Smells like chicken
just like the linkedin bag holders?
I will 50% flip at 76, if it makes it that high and hold 500.
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Apples to oranges. Not similar at all. 100 billion market cap vs a 10 billion cap.
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mquinnjr
Footballguy
The coverage on Bloomberg TV is the equivalent of stock market porn. I love it.
Sarnoff
Footballguy
I'm not a buyer at $38, not sure if I'll be a buyer when it hits $2 next week...
Lol at it hitting 76 today.
chet
Footballguy
Jinkies!!Especially with his allocation. Lots of flippers in this deal.
Ned
Footballguy
I am skeptical I make anything at $38, hence my original post. But having more then 1 plan makes sense.
Yes, but why even have a plan that makes no sense.You're not getting 76, be more realistic, and double lol for stating you'll only sell half if it hit that ridiculous price.
Yeah I get it, but my plan is not to flip this stock. I will flip under a few scenerios.
chet
Footballguy
I highly doubt it breaks $38. I am sure they exercised the full greenshoe and short.
Open at $43, down to about $40
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chet
Footballguy
no way it breaks offer price today
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