For the record, DoK has a much better view on the actual question in the OP. I have never done that kind of an analysis is my life and I wouldn't know where to begin but I do know Facebook comparisons to Myspace are way off base and I do know that a company who pulled in 3.7 billion in revenue over the past year is not based on hype.
thats what its all about. projecting.rofl why are you guys arguing about how much facebook is making.....their financial statements are available to the public
Manny is right that they are making billions, but I don't see how their revenue is gonna shoot up so quickly over the next 10 years the way so many are projecting.
I think its completely fair to be wary of long term projections of huge growth. Having 1 in 7 people on earth using your product is pretty damn good critical mass, though.rofl why are you guys arguing about how much facebook is making.....their financial statements are available to the public
Manny is right that they are making billions, but I don't see how their revenue is gonna shoot up so quickly over the next 10 years the way so many are projecting.
overpriced for what it provides and how it generates cashflow
you really cant compare it to google until it starts to branch out....im surprised google with its capital hasnt started to get into the ISP sector providing services..thats where the money is if you can break up the monopoly of the big2
You're right, I'm not sure why Che is arguing with you here
http://sec.gov/Archives/edgar/data/1...954ds1.htm#toc
Page 40 clearly says their 2011 revenue was just over 3.7 billion
Myspace died (essentially) because something better came along, Facebook. Facebook faces that same risk of something better coming along. Will it? Remains to be seen.
The difference between Facebook and McDonalds is the financial barrier to competition is a lot lower for a social networking site than it is for a restaurant chain. If you want to compete with McDonalds you not only need to come up with better products, you need to spend billions of dollars to build thousands of stores. If you want to compete with Facebook, you still need to come up with a better product, but the financial commitment required isn't nearly as much.
They're making billions, but are they making enough billions to justify the share price? I have my doubts.
no reason to argue semantics. my point is that no way can you compare Facebook to google/apple
Google/Apple got their infrastructure tentacles deeply entrenched in the market. They have a solid foundation.
Facebook doesn't. Nobody knows what could happen, so everyone jumping on the bandwagon of a first in history is dumb IMO.
Facebook is like a meat business that has the gate open where the cattle live. The cattle might stay and eat there, or the cattle might decide to leave. The door is wide open and they can't really do anything to close it.
will its share make money? sure the ubber rich in the short term. But longterm, I would not bet my retirement on it.
They actually have started to get into the ISP business.
http://www.google.com/fiber/kansascity/index.html
I think you're right that Google is the far superior company but really who else do you compare them to?
The encouraging thing for facebook in the "something better might come along" department is that I thought google+ might swallow it up and do to it what it did to myspace but that hasn't happened. If google can't overtake facebook in the social networking department I'm not sure what can.
Last edited by DUNCANownsKOBE; 05-18-2012 at 09:33 AM.
Are you sure about that? Google just poured money into their social networking site and couldn't make it happen. Not to mention that Facebook is so huge now that if something better comes along they just buy it while its small. I think you're really underestimating how much control Facebook has in this situation.
The Myspace comparisons really are incredibly shallow. At the time Myspace went down it certainly wasn't making billions a year (if anything) and they certainly didn't have 900 million users.
I honestly can't say.They're making billions, but are they making enough billions to justify the share price? I have my doubts.
I never compared them to Apple. Apple is a manufacturing company so that would be dumb. The Google comparison is off as well, but thats the closest you'll find. Its certainly a much more valid comparison than Myspace.
When I first compared them to Google it was merely to point out how a company who's main business model involves free services on the web in order to sell advertising and user info can succeed very very very well.
LOL can you say bubble:
Ian King, Business Editor, The Times
He writes that Facebook ‘polarises opinions like few other stocks’. He points out: ‘By all regular investment yardsticks, a $100 billion valuation is madness. It values Facebook at slightly more than 25 times its 2011 sales. Google, a more established business and considerably more profitable, by contrast trades at six times sales. Apple, on some valuation metrics being applied to Facebook, would be worth more than 42 trillion.’
The problem with G+ was the fact that no one was on it. I really liked the interface and some things they came up with but the fact that Facebook was already centralized with EVERYONE it was just dumb to go to G+ and end up reading fewer items which were already posted somewhere else.
I truly believe that user base is going to be hard as hell to overcome unless - as you pointed out - all of a sudden Facebook goes stupid and starts to charge.
Zuckerberg Rings Opening Bell
Facebook founder and CEO Mark Zuckerberg rang the Wall Street's opening bell on Friday, the day his company is set to debut on the market. Facebook will start trading stocks on the open market at 11 a.m. Friday, 90 minutes after the New York Stock Exchange opens, and a share will be traded at $38, giving the company a $104 billion valuation. Meanwhile, CNBC looked at the private market data for Facebook, finding that when Facebook first sold shares in April of 2008 on SecondMarket, a place where private trades take place, the company was valued at $8.1 billion. But SecondMarket trades showed that in April 2009, about a year after Facebook's private shares began trading, the valuations plunged to just $2.6 billion, with shares worth just a little more than a dollar.
Read it at CNBC
http://www.thedailybeast.com/cheats/...=Cheat%20Sheet
FB does seem to have survived that challenge, at least for the time being. But Google makes a shitload of money too (3x FB's revs IIRC) so Facebook can't take their eye off of them just quite yet.
Fair enough. I think think you're overestimating Facebook's invincibility. Agree to disagree.
NEW YORK (Reuters) - Shorting the Facebook IPO on its first day of trading will not be for the faint of heart.
As the hottest initial public offering in recent memory, Facebook has drawn 1990s-style tech-mania interest from mom and pop investors and big institutions alike.
That intense appeal means even short-selling veterans are a bit wary, at least for now.
"I have no interest in shorting a cultural phenomenon," hedge fund manager Jeffrey Matthews of Ram Partners in Greenwich, Connecticut, told Reuters in an email interview.
Asked if this was because such stocks trade without regard to normal market valuation, he wrote back, "Bingo."
Short sellers looking to get in are facing an uphill battle. Traders interviewed said the stock is going to be hard to borrow, at least for a few days, and only the best-sourced hedge fund managers will able to find lenders.
A prime broker at one of the top underwriters of the IPO said the firm will not be lending shares at least until the initial settlement in three business days.
"I don't know how many shares will be available for shorting," said the broker, who requested anonymity. "We would only provide them once the deal has stabilized."
The bigger-than-usual percentage of retail-investor ownership of the shares may make shorting more difficult, as those investors don't tend to lend their shares for those who want to take a short bet.
"It will likely be difficult to get shares to borrow," said Adam Reed, professor of finance at UNC Kenan-Flagler Business School in Chapel Hill, North Carolina.
"In our research, we found that around 70 percent of IPOs are borrowable on the first day, but many of those names were only borrowable by well-placed investors."
The stock priced at $38 a share Thursday.
Those who are able to short will need nerves of steel. The borrowing cost will be high, and short-sellers may find the trade hard to get out of by buying back the stock in the open market, and could face a lender calling in their shorts if the stock rallies sharply.
Still, some have started laying the groundwork to short Facebook well before trading started.
"I'm doing the legwork now and calling all the brokers," said a hedge fund manager earlier in the week. "Goldman and Credit Suisse are our prime brokers, so I am in contact with them about this."
"This is about as bubbly as you can get," he said. "My mother asked me if she could get Facebook shares and she has never been interested in IPOs before. A cab driver asked me about the IPO too. That's when you want to short it."
The hedge fund manager asked not to be named as he expected to be involved in trading the stock on Friday.
Some hedge funds, remembering the heady days of the tech bubble in the late 1990s, have been sensing the blood in the water in the recent flurry of social media and networking IPOs, including Groupon, LinkedIn, and Zygna.
Many believe those stocks' valuations are too high, given expectations for their growth and revenue outlook. Should shares surge to $70 or so in short order, it will be an opportunity for managers when the initial flurry of retail interest fades in coming days or weeks.
However, Facebook may be an exception.
"I think it's going to be an extraordinarily successful IPO and it's going to be a must-own stock institutionally, besides the massive retail demand, for obvious reasons - it's the dominant factor in social media, social networking," said Doug Kass, president of Seabreeze Partners in Palm Beach, Florida.
Kass hasn't been afraid of shorting hot IPOs in the past - he made quick, short bets on LinkedIn in the initial days after it began trading in May 2011. That stock had a small float of just 7.84 million shares, compared with the 421 million shares Facebook sold.
At the $38-a-share IPO price, Facebook would trade at over 100 times historical earnings, versus Apple Inc's 14 times and Google Inc's 19 times.
Even among the skeptical, there is a good deal of caution in facing down what is likely to be a stampede. As economist John Maynard Keynes famously noted, the market can stay irrational longer than investors can stay solvent.
"Facebook is the kind of stock that, if you don't like it, you simply avoid it," said Mohannad Aama, managing director at Beam Capital Management LLC in New York.
it won't be hard to borrow for the real players.
imo facebook has way more people that actually use it. google just added a + account to anyone who has gmail and counts them as active users. I am unsure how facebook will continue to make more money when nearly all of their new features seem to be merely tolerated or flat out disliked (my opinion just based on what I see/hear, like timeline).
So it goes.
Up 13% at opening, back down to +5% after about 30 minutes.
Interactive chart won't post. opened out of the gate up 13% at 43 then dropped essentially straight down to 40.
http://quotes.wsj.com/FB
A letter from Mark Zuckerberg about Facebook IPO.
MENLO PARK, CA (The Borowitz Report) – On the eve of Facebook’s IPO, Founder and CEO Mark Zuckerberg published the following letter to potential investors:
Dear Potential Investor:
For years, you’ve wasted your time on Facebook. Now here’s your chance to waste your money on it, too.
Tomorrow is Facebook’s IPO, and I know what some of you are thinking. How will Facebook be any different from the dot-com bubble of the early 2000’s?
For one thing, those bad dot-com stocks were all speculation and hype, and weren’t based on real businesses. Facebook, on the other hand, is based on a solid foundation of angry birds and imaginary sheep.
Second, Facebook is the most successful social network in the world, enabling millions to share information of no interest with people they barely know.
Third, every time someone clicks on a Facebook ad, Facebook makes money. And while no one has ever done this on purpose, millions have done it by mistake while drunk. We totally stole this idea from iTunes.
Finally, if you invest in Facebook, you’ll be far from alone. As a result of using Facebook for the past few years, over 900 million people in the world have suffered mild to moderate brain damage, impairing their ability to make reasoned judgments. These will be your fellow Facebook investors.
With your help, if all goes as planned tomorrow, Facebook’s IPO will net $100 billion. To put that number in context, it would take JP Morgan four or five trades to lose that much money.
One last thing: what will, I, Mark Zuckerberg, do with the $18 billion I’m expected to earn from Facebook’s IPO? Well, I’m considering buying Greece, but that would still leave me with $18 billion. LOL.
Friend me,
Mark
http://www.borowitzreport.com/2012/0...rk-zuckerberg/
Already back to 38 going straight down. Looks like all the institutional early birds are taking their quick profit and getting out.
Bounced back at 38 bottom...looks like the retail mom and pop orders are providing support. This is interesting to watch.
Back up to almost $40
LOL dropped about $.50 in the minute since I posted that.
Seems to be settling in at that $38-$40 range. I'm kinda surprised the market's agreeing with the IPO price.
Still too early to tell IMHO. There was a lot of pre-order froth on this one.
In.
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Originally Posted by WC
"...but it was your assumption that assumed I made an assumption"
Originally Posted by boutons_deux
...you're not curious about anything outside of your close-minded, benighted blind ideology.
You're braver than I, but best of luck to you sir.
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