So is Facebook really worth $38 a share?

[CosmicCowboy]

I don't see any fucking way it's worth that much. If it opens at $38 this morning, where do you think it will be when the bell rings this afternoon? I'm thinking down at least 10-15%...

[clambake]

could be up 50%.

[AussieFanKurt]

I think you underestimate how much Facey is worth and ultimately how powerful it is

[coyotes_geek]

Off the fundamentals, I agree with you, not worth that much. But today isn't about fundamentals it's about hype. So I'll take the "over" on FB closing at $38.

[CosmicCowboy]

But where does the revenue come from?

[MannyIsGod]

Having access to an unprecedented customer base? How does Google make their money? Google started out as a search engine that was the best and a huge user base. They branched out into other things but it all started with having a dedicated base of customers that keep coming back to your site and Facebook has that and then some.

[clambake]

orders have been placed since 2 weeks ago. might not be able to get it for 38 from the get go.

[CosmicCowboy]

Having access to an unprecedented customer base? How does Google make their money? Google started out as a search engine that was the best and a huge user base. They branched out into other things but it all started with having a dedicated base of customers that keep coming back to your site and Facebook has that and then some.

Checked your myspace page lately?

[CosmicCowboy]

If it's such a good deal, why is 60% of the stock being offered being sold by insiders?

[TeyshaBlue]

Dude...it's gonna be a steal @ <$50.

[coyotes_geek]

Having access to an unprecedented customer base? How does Google make their money? Google started out as a search engine that was the best and a huge user base. They branched out into other things but it all started with having a dedicated base of customers that keep coming back to your site and Facebook has that and then some.


Checked your myspace page lately?

The entire quandry about Facebook's worth perfectly summed up in two posts.

[MannyIsGod]

Myspace was never anywhere near Facebook numbers and they certainly didn't last nearly as long. Myspace came up at pretty much the same time as Facebook started. They came up in 2003 and Facebook came along about 6 months later. Yet Myspace hasn't been ahead of Facebook in about 6 years or so. They were a flash in a pan while Facebook has been going strong for nearly a decade now and they almost have a BILLION users. A fucking BILLION CC.

BILLION.

[cheguevara]

overpriced bullshit

when all is said and done nobody will make money off this shit except the ubber rich

[MannyIsGod]

The entire quandry about Facebook's worth perfectly summed up in two posts.

Aside from both being social networking sites how are they compareable? Would you say that McDonalds is worth a lot less simply because of another fast food company who went out of business (although technically MySpace is still in business and they still traffic a lot of web businesses would love).

[cheguevara]

I think you underestimate how much Facey is worth and ultimately how powerful it is

ultimately it ain't worth a lick. but we'll find that out in years to come

[clambake]

overpriced bullshit

when all is said and done nobody will make money off this shit except the ubber rich

wut?

[cheguevara]

Aside from both being social networking sites how are they compareable? Would you say that McDonalds is worth a lot less simply because of another fast food company who went out of business (although technically MySpace is still in business and they still traffic a lot of web businesses would love).

the site is as good as long as the users remain. Nobody really can control when the users will start leaving for other pastures. But it will happen. it will happen.

BTW I heard 80% of the users are worthless 3rd country folk

[MannyIsGod]

Do you guys realize that this is not some gimmick business? They're already making billions off of advertising money and their data collection on their user base is pretty much only comparable to Google.

[MannyIsGod]

the site is as good as long as the users remain. Nobody really can control when the users will start leaving for other pastures. But it will happen. it will happen.

BTW I heard 80% of the users are worthless 3rd country folk

:lmao

So you're telling me that the business is only good as long as the customers keep coming back? Holy shit Che, you must be some kind of business major or something.

[cheguevara]

:lmao

So you're telling me that the business is only good as long as the customers keep coming back? Holy shit Che, you must be some kind of business major or something.

The Facebook users are not the customers. They are the goods.

[MannyIsGod]

If it's such a good deal, why is 60% of the stock being offered being sold by insiders?

A bird in the hand is worth two in the bush. A lot of the employees aren't rich and have been waiting for this IPO for a LONG time.

I just find it hard to label a business who has 900 million users and is already making billions as nothing but hype.

[MannyIsGod]

The Facebook users are not the customers. They are the goods.

try again

The goods are the services Facebook gives to its users. Its customers. It has more than one customer base but to say that the users aren't customers is flat out stupid.

[DUNCANownsKOBE]

The share price isn't as good an indication as the full IPO which last I checked was around $100B. I had to do a projected cash flows analysis for facebook's IPO in a class last semester and in order for facebook to truly be worth $100B, it needs ridiculous revenue growth in the next 10 years which I don't see.

[cheguevara]

The goods are the services Facebook gives to its users. Its customers. It has more than one customer base but to say that the users aren't customers is flat out stupid.

Facebook plans to make the real money off selling user info and access. To the big companies which are its main customers.

I don't believe Facebook is making any money from common users or will anytime soon.

[clambake]

that depends on the share price.

[DUNCANownsKOBE]

Facebook will never make money off its common user. I think I speak for most people when I say that if facebook starts charging user fees, I'm shutting my account down and switching to google+.

[cheguevara]

Facebook will never make money off its common user. I think I speak for most people when I say that if facebook starts charging user fees, I'm shutting my account down and switching to google+.

yup. in the worst case facebook will make some money from app vendors. kinda like how apple makes money from the appstore. but that is far, far from happening, if it ever happens IMO

[clambake]

Facebook will never make money off its common user. I think I speak for most people when I say that if facebook starts charging user fees, I'm shutting my account down and switching to google+.

you seem to be analyzing this as a longterm investment.

[MannyIsGod]

Facebook plans to make the real money off selling user info and access. To the big companies which are its main customers.

I don't believe Facebook is making any money from common users or will anytime soon.

You don't think Facebook is making billions annually off of advertising? Why? With 900 million users its really fairly reasonable.


But Leung also projected that Facebook's annual revenue -- reported at $3.7 billion last year -- will grow by 40 percent in 2012 and a further 33 percent in 2013. Other analysts have been equally bullish.

http://www.goerie.com/article/20120518/BUSINESS05/305189965/SAVVY%3A-Is-Facebook-a-good-investment%3F

Also, saying they are not going to make money from the common user is stupid if they're selling their info and making money.

[DUNCANownsKOBE]

rofl why are you guys arguing about how much facebook is making.....their financial statements are available to the public :lol

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.

[MannyIsGod]

The share price isn't as good an indication as the full IPO which last I checked was around $100B. I had to do a projected cash flows analysis for facebook's IPO in a class last semester and in order for facebook to truly be worth $100B, it needs ridiculous revenue growth in the next 10 years which I don't see.

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.

[clambake]

rofl why are you guys arguing about how much facebook is making.....their financial statements are available to the public :lol

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.
thats what its all about. projecting.

[MannyIsGod]

rofl why are you guys arguing about how much facebook is making.....their financial statements are available to the public :lol

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.

[TDMVPDPOY]

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

[coyotes_geek]

Aside from both being social networking sites how are they compareable? Would you say that McDonalds is worth a lot less simply because of another fast food company who went out of business (although technically MySpace is still in business and they still traffic a lot of web businesses would love).

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.


Do you guys realize that this is not some gimmick business? They're already making billions off of advertising money and their data collection on their user base is pretty much only comparable to Google.

They're making billions, but are they making enough billions to justify the share price? I have my doubts.

[DUNCANownsKOBE]

I do know that a company who pulled in 3.7 billion in revenue over the past year is not based on hype.
You're right, I'm not sure why Che is arguing with you here :lol

http://sec.gov/Archives/edgar/data/1326801/000119312512034517/d287954ds1.htm#toc

Page 40 clearly says their 2011 revenue was just over 3.7 billion

[cheguevara]

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.

[MannyIsGod]

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

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?

[DUNCANownsKOBE]

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.

[MannyIsGod]

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.


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.



They're making billions, but are they making enough billions to justify the share price? I have my doubts.

I honestly can't say.

[MannyIsGod]

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.

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.

[cheguevara]

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.’

[MannyIsGod]

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 facebook but that hasn't happened. If google can't overtake facebook in the social networking department I'm not sure what can.

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.

[boutons_deux]

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/2012/05/18/facebook-s-private-trades-revealed.html?utm_medium=email&utm_source=newsletter&utm_campaign=cheatsheet_morning&cid=newsletter%3Bemail%3Bcheatsheet_morning&utm_term=Cheat%20Sheet

[coyotes_geek]

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 facebook but that hasn't happened. If google can't overtake facebook in the social networking department I'm not sure what can.

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.


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.

Fair enough. I think think you're overestimating Facebook's invincibility. Agree to disagree.

[CosmicCowboy]

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.

[clambake]

it won't be hard to borrow for the real players.

[leemajors]

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).

[CosmicCowboy]

Up 13% at opening, back down to +5% after about 30 minutes.

[CosmicCowboy]

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

[CosmicCowboy]

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/2012/05/17/a-letter-from-mark-zuckerberg/

[CosmicCowboy]

http://media.dcentertainment.com/sites/default/files/MAD-Magazine-Facebook-Stock-Certificate.jpg

[CosmicCowboy]

Already back to 38 going straight down. Looks like all the institutional early birds are taking their quick profit and getting out.

[CosmicCowboy]

Bounced back at 38 bottom...looks like the retail mom and pop orders are providing support. This is interesting to watch.

[baseline bum]

Back up to almost $40

[baseline bum]

LOL dropped about $.50 in the minute since I posted that.

[coyotes_geek]

Seems to be settling in at that $38-$40 range. I'm kinda surprised the market's agreeing with the IPO price.

[CosmicCowboy]

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.

[TeyshaBlue]

In.
http://i3.photobucket.com/albums/y64/teyshablue/fb.jpg

[coyotes_geek]

You're braver than I, but best of luck to you sir.

[CosmicCowboy]

Damn. Other social media sites are taking a shit in the market. Zynga just popped the circuit breaker.

[coyotes_geek]

Damn. Other social media sites are taking a shit in the market. Zynga just popped the circuit breaker.

Not sure what to make of that. Just a bunch of social media stock lovers dumping their shares in the others so that they can get in on FB?

[CosmicCowboy]

Holy shit! FB has already traded 250 million shares. To put that in perspective when Google went public they traded 101 million all day.

[TeyshaBlue]

You're braver than I, but best of luck to you sir.

I made a nice sum on GM by buying right before the bailout. I just rode the rumor for a couple of days and made about 30%. I didn't bet much on it either, tho.:lol

[coyotes_geek]

I made a nice sum on GM by buying right before the bailout. I just rode the rumor for a couple of days and made about 30%. I didn't bet much on it either, tho.:lol

I made some good money on GM too, back in the early 2000s before they got themselves into trouble. Haven't been back though. I keep an eye on Ford, but haven't pulled the trigger on anything as of yet.

[CosmicCowboy]

WSJ just reported that FB bottomed at $38 because the underwriters bought it to stop the free fall.

[TeyshaBlue]

It's gonna bounce like crazy with margin swings +/- of 10%. It'll settle in and climb.

[CosmicCowboy]

Damn, 275 million shares traded so far. Looks like the retail buyers like Teysha are piling in.

[TeyshaBlue]

"It's gonna bounce like crazy with margin swings +/- of 10%. It'll settle in and climb."

Fucking robo-trading algorithmic bullshit.

[CosmicCowboy]

"It's gonna bounce like crazy with margin swings +/- of 10%. It'll settle in and climb."

Fucking robo-trading algorithmic bullshit.

Looks like the underwriters picked $40 as ground zero. There was huge volume at $40 when it started to slide back earlier.

[TeyshaBlue]

Probable...and a reasonable floor.

[TeyshaBlue]

Yeah...looks like $40 was the 1yr target estimate.

[ElNono]

Facebook is going to increase their revenue on massive advertising and licensing deals, or it won't increase it at all. They have a popular platform, but now they'll have to deal with shareholder pressure to increase those revenues every quarter/year.

That's why Google didn't pull the plug on plus yet, even though so far it has been an epic fail. The Facebook experience is about to change considerably (and will likely be brought to you by Procter & Gamble).

[TeyshaBlue]

Good grief. ZNGA is getting raped.

[TeyshaBlue]

Facebook is going to increase their revenue on massive advertising and licensing deals, or it won't increase it at all. They have a popular platform, but now they'll have to deal with shareholder pressure to increase those revenues every quarter/year.

That's why Google didn't pull the plug on plus yet, even though so far it has been an epic fail. The Facebook experience is about to change considerably (and will likely be brought to you by Procter & Gamble).

Yup. Welcome to "shareholder value".:depressed

[boutons_deux]

Facebook sued for $15 billion over alleged privacy infractions

As Facebook prepares to start trading on the Nasdaq, a class-action lawsuit has been brought against it.

Law firm Stewarts Law US announced today that it has combined 21 privacy lawsuits against the social network into a single, class-action suit, charging the world's largest social network with violating user privacy by allegedly tracking their Web usage.

Stewarts Law is asking for $15 billion -- a sum it arrived at by calling on the U.S. Wiretap Act, which "provides statutory damages of the greater of $100 per violation per day, up to $10,000, per Facebook user," the law firm wrote in its suit, according to Bloomberg, which was first to report on the story.

For Stewarts, timing is everything. The law firm filed the lawsuit just hours before Facebook was set to offer its shares on Nasdaq for $38. Interestingly, the sum Stewarts and its plaintiffs are seeking -- $15 billion -- is just $1 billion shy of the cash Facebook will raise in its offering.

However, that damages amount could go up. In a statement to Bloomberg, David Straite, a partner at Stewarts, said his firm is "evaluating the way in which non-U.S. residents" could be added to the plaintiffs list

http://news.cnet.com/8301-1023_3-57437060-93/facebook-sued-for-$15-billion-over-alleged-privacy-infractions/?tag=mncol;txt

[CosmicCowboy]

Volume over 300 million now.

[Goran Dragic]

:lol a P/E ratio over 94. That's unheard of.

[Goran Dragic]

WSJ just reported that FB bottomed at $38 because the underwriters bought it to stop the free fall.
Well that band-aide won't work long term so if that's true you're right, the stocks gonna tumble :lol

[mavs>spurs]

average lifecycle of social networking sites is not that long. i'd imagine that everyone will not still be on facebook in another 5 years. that isn't even taking into account the fact like dok said, even IF we could assume facebook will be around forever it still doesn't make enough money to be valued at 100b. i feel sorry for the suckers who hold on to this thing for very long.

[Spurminator]

Fucking casino.

[CosmicCowboy]

Volume 340 million. Looks like it's gonna set a one day all time record at this rate.

[Goran Dragic]

average lifecycle of social networking sites is not that long. i'd imagine that everyone will not still be on facebook in another 5 years. that isn't even taking into account the fact like dok said, even IF we could assume facebook will be around forever it still doesn't make enough money to be valued at 100b. i feel sorry for the suckers who hold on to this thing for very long.
Now it's market cap is at $112B :lmao

[mavs>spurs]

Now it's market cap is at $112B :lmao

classic example of irrational exuberance

[hater]

http://thebiglead.fantasysportsven.netdna-cdn.com/wp-content/uploads/2012/05/charles-shake-weight.gif

[CosmicCowboy]

Dropping back towards $40 again. Wanna bet it bounces back at $40.01?

[CosmicCowboy]

LOL

Bounced like a fucking basketball @ 40. Back over 41 in less than a minute.

[leemajors]

http://thebiglead.fantasysportsven.netdna-cdn.com/wp-content/uploads/2012/05/charles-shake-weight.gif

:lmao

[CosmicCowboy]

dropping back towards $40 again...this is hilarious to watch. You can just see those underwriters in their New York skyscrapers screaming FUCK!FUCK!FUCK!FUCK!:lol

[mavs>spurs]

^it's their own dumbass fault for assuming that the people are even more stupid than they think they are

[CosmicCowboy]

just sitting there bumping up and down just a hair over 40.

[CosmicCowboy]

If it even makes it through the day over 40 I'll bet it opens down hard on Monday morning after everyone has time over the weekend to absorb what happened today.

[CosmicCowboy]

LOL..it hit 40.01 for a second and immediately jumped to 40.5...then started sliding again.

This is awesome. I'm sure those underwriters are just praying for 4:00 to get here.

[CosmicCowboy]

http://blogs.wsj.com/deals/2012/05/18/facebook-ipo-response-from-asset-managers-its-a-dud/?mod=WSJ_qtoverview_wsjlatest

Some asset managers responded to Facebook’s somewhat underwhelming debut Friday with disappointment following a historic run-up to the offering.


Michael Mullaney, vice president and chief investment officer for Boston-based Fiduciary Trust said his firm has $9.5 billion in assets under management, and primarily represents high net worth individuals. A handful of clients are interested in buying Facebook shares, including one who said he would buy in at any price. Mullaney opted not to put in an allocation order, and instead bought shares on the open market on Friday.

“If we did get one it would have been a small piece,” said Mullaney. “And then who would we give it to? Which one of our clients gets the shares? I’d rather trade it on the open market with every Tom, Dick and Harry. It makes my life easier.”

On Friday at 1 p.m., Mullaney said in an email that he had received his shares at the price he liked, but considered the IPO “a dud.”

Ronald Coleman, head of research and institutional equity of Columbus Advisors Group in Taunton, Mass., with $200 million in assets under management, said he put in an order two weeks ago for 75,000 shares of Facebook. On Thursday, he predicted that he would probably get just 1,000 or 2,000 shares, a fraction of what he asked for. He asked for far more than he expected to receive, a practice that has been common among money managers.

“This is a hot deal,” said Coleman. “If this were a weak deal, you would ask for what you want.”

But on Friday morning, just before the start of trading, Coleman learned he had not been awarded any shares. He said he believed other smaller investors – Coleman manages about $50 million in assets under management – also had been shut out.

“I’m disappointed, but not surprised,” he said.

Coleman thought he might buy in on the open market, but by 1 p.m. on Friday had changed his mind.“It’s a flop,” he said of the IPO. His target price was $50 to $55 a share. “I was looking for a 20% to 30% pop on day one, and you didn’t see that.”

He said he will spend the weekend re-evaluating to see whether he’ll buy in on Monday. “Long term, the model is still a good one, but the problem was they waited too long to go public,” Coleman said of Facebook.

[Wild Cobra]

Who in their right mind would want to invest in this?

Soon after they made privacy changes and announced the stock, I deleted my account. It's going to become as worthless as MySpace.

[CosmicCowboy]

Just passed 400 million shares traded. The chart is hilarious. The underwriters must have a computerized buy order @ exactly $4.01...it's just bouncing along there...

[CosmicCowboy]

This is fascinating. Every time it hits 40.01 there is an immediate 100,000 share buy.

[CosmicCowboy]

I'm wondering when they are going to throw in the towel. I don't think they are gonna be able to hold it at $40.

[Goran Dragic]

dropping back towards $40 again...this is hilarious to watch. You can just see those underwriters in their New York skyscrapers screaming FUCK!FUCK!FUCK!FUCK!:lol
rofl imagine whats gonna happen once the underwriters unload their shares and have no reason to keep bumping it

[CosmicCowboy]

They have been price supporting since noon. They are probably on the hook for hundreds of millions right now.

[CosmicCowboy]

Looks like they are buying in 200,000 share blocks now and only moving the price a penny or two...

[CosmicCowboy]

Ruh Roh.

Free fall...looks like they gave up.

$39.6 and dropping straight down.

[CosmicCowboy]

Looks like a new buy floor @ 39.6

[CosmicCowboy]

Couldn't hold it.

This could get ugly.

[CosmicCowboy]

About to break below 39 trading about a million shares a minute.

[hater]

LOL Nasdaq

LOL facebook

NEW YORK – The big pop in Facebook Inc. shares never came.

Buyers did not rush into the market to snap up shares of the social networker. And the big Wall Street banks that brought Facebook public scrambled to prevent the stock from collapsing into declines.

The underwriters averted a potential debacle by scooping up shares of the company during the Nasdaq debut. This propped up the stock, keeping it above the $38 offering price through most of the day.

“When a deal gets priced and breaks price on the first day, that’s definitely a major embarrassment," said trader Andrew Frankel, co-president of Stuart Frankel & Co. "But it didn’t do that here – at least for the time being.”

The practice is pretty standard during IPOs, especially high-profile ones like Facebook. The big banks buy into a wave of selling as a way to prevent their customers from suffering big losses.

The syndicate of underwriters led by Morgan Stanley helped prop up shares after the Nasdaq Stock Market experienced technical problems processing trades. A number of brokerages reportedly said they were having problems trying to trade the stock.

“There are currently industrywide delays in reporting trade executions,” Michael Cianfrocca, a spokesman for brokerage Charles Scwhab, told Bloomberg News. “These issues do not appear to be unique to Schwab.”

The problems could threaten the Nasdaq’s reputation as the premier platform to list big blue-chip technology companies. The exchange won a hard-fought battle against the New York Stock Exchange for a chance to list Facebook.

Spokesmen for the Nasdaq did not return several telephone calls and emails seeking comment.

Many traders, Frankel said, "backed away from trading Facebook because Nasdaq had such system issues.”

The stock bolted at the open to $42.05, but then quickly withered in the first hour of trading. It touched $38 several times, but eked out a small rebound and leveled off at about $40.

Barry Ritholtz, head of Fusion IQ, an investment research firm, added: "It pretty much started straight down to $38, where as normally happens, the underwriters defended it."

http://www.latimes.com/business/technology/la-fi-tn-facebook-trading-20120518,0,6622700.story

[TeyshaBlue]

Bleh...out @ 39.56.

[CosmicCowboy]

Looks like they are trying to hold it at 38.5

Damn. Just passed 450 million shares traded. I'm pretty sure thats a new one day record and there is still 45 minutes to the close.

[Goran Dragic]

Bleh...out @ 39.56.
rofl you're a better investor than me no way would I be able to accept a loss and sell that quickly.

[TeyshaBlue]

I didn't take a loss. I bought @ $38.60.

[TeyshaBlue]

I might buy a coke with the proceeds after the commissions.:lol

[Goran Dragic]

I didn't take a loss. I bought @ $38.60.
my bad read your initial post wrong. Well done :tu

[baseline bum]

Damn, $38.25 and dropping.

[TeyshaBlue]

my bad read your initial post wrong. Well done :tu

Sure as hell didn't go where I thought it was going to. The price in my first post was my active ticker on my portfolio summary page. That's the price it was when I screen capped my summary. It had already moved to $40 and change by then.:lol

[baseline bum]

About to hit $38 now. Sucks for the people who bought at $42.

[CosmicCowboy]

Ouch, what an embarrassment. Looks like it's gonna close lower than the offering price.

[Goran Dragic]

:lmao these desparate underwriters buying at $42

[CosmicCowboy]

:lmao

$38.02

*underwriters looking at clock*

FUCKFUCKFUCKFUCKFUCKFUCK!!!!!!!!!!

[baseline bum]

Shit's been hovering just a pubic hair about $38 for a while now. :lol

[baseline bum]

$38.00 :lol

[CosmicCowboy]

Hit $38 and and underwriters bought another million shares. jumped immediately.

[Goran Dragic]

:lol it's so obvious what's going on

[baseline bum]

Hit $38 and and underwriters bought another million shares. jumped immediately.

It got them a whole 2 cents. :lol

This is way more interesting to watch than the playoffs tbh.

[CosmicCowboy]

I don't think they will be able to hold it another 16 minutes. I'll bet they break 500 million shares traded by the close.

[CosmicCowboy]

Hit 38 again...*boom* another million shares

[TeyshaBlue]

I don't think they will be able to hold it another 16 minutes. I'll bet they break 500 million shares traded by the close.

526,962,912 right now.

[CosmicCowboy]

somebody is throwing some serious scratch on the table just for their ego.

[TeyshaBlue]

30 - 50k shares/sec!

[Goran Dragic]

I don't think they will be able to hold it another 16 minutes. I'll bet they break 500 million shares traded by the close.
They'll prolly be able to hold it for today but good luck for tomorrow after every news source imagineable has the rest of the day to put their own spin on underwriters needing to prop the stock up.

[baseline bum]

What the fuck is this going to be trading at by noon Monday? :lol

[mavs>spurs]

What the fuck is this going to be trading at by noon Monday? :lol

24 dollars

[CosmicCowboy]

:lmao

You can tell they have the computer set to buy whatever is offered at $38

[CosmicCowboy]

What the fuck is this going to be trading at by noon Monday? :lol

No shit. Everyone is gonna go home over the weekend and have a chance to absorb that it ain't all it cracked up to be and I'll bet it opens down right off the bat Monday.

[Goran Dragic]

Wow I just realized today is Friday.

The media has all weekend to stur up panic about the underwriters buying shares back

[baseline bum]

Closes at $38.37.

[FuzzyLumpkins]

Does the offer include dividends at least?

[Goran Dragic]

Does the offer include dividends at least?
rofl the whole point of an IPO is to raise capital.....companies that need to raise capital aren't paying dividends. Especially ones like facebook where shareholders expect re-investment of earnings and high growth.

[CosmicCowboy]

:lmao

Looks like a powerful initial offering customer @ $42 dollars just shoved a big block of shares right up the underwriters ass...FB was cruising along in after hours trading just a hair over $38 and all of a sudden there was a big sale @ $42 and then it dropped right back to $38.

http://quotes.wsj.com/FB

I don't ever remember seeing a chart like that...:lol

[FuzzyLumpkins]

rofl the whole point of an IPO is to raise capital.....companies that need to raise capital aren't paying dividends. Especially ones like facebook where shareholders expect re-investment of earnings and high growth.

IPO's traditionally trade shares with dividend expectations for cash. thats how it typically works. Dividends are paid out over time whereas the cash is paid out front.

Your post is about as well though out as your racist diatribes.

[CosmicCowboy]

Damn. Just did it again...

[CosmicCowboy]

IPO's traditionally trade shares with dividend expectations for cash. thats how it typically works. Dividends are paid out over time whereas the cash is paid out front.

Your post is about as well though out as your racist diatribes.

This is incorrect, especially tech growth stocks. Many stocks don't pay dividends and the shareholder is rewarded by capital gains in the value of his stock.

[FuzzyLumpkins]

This is incorrect, especially tech growth stocks. Many stocks don't pay dividends and the shareholder is rewarded by capital gains in the value of his stock.

Now they don't and as you say especially with tech stocks. Another trend pioneered by Jobs. Thats why I asked. Its called uncertainty.

So anyone have the answer to my question?

[CosmicCowboy]

There have now been a couple of wild after hours block trades @ $42 with an immediate bounce back to $38....crazy shit.

[CosmicCowboy]

Now they don't and as you say especially with tech stocks. Another trend pioneered by Jobs. Thats why I asked. Its called uncertainty.

So anyone have the answer to my question?

I actually thought he gave you a good answer. Don't expect any dividends from FB any time soon.

[CosmicCowboy]

Holy shit. It really looks like someone is buying back shares from pissed off customers.

[DarrinS]

I have never used/been on Facebook.

[TeyshaBlue]

Holy shit. It really looks like someone is buying back shares from pissed off customers.

In huge fucking buy orders.

[CosmicCowboy]

Seriously. Some of you other guys that understand the market check out that chart...either the computer is going nuts or there are a bunch of after hour block trades getting executed at $42 when the markets at $38.

[Goran Dragic]

IPO's traditionally trade shares with dividend expectations for cash. thats how it typically works. Dividends are paid out over time whereas the cash is paid out front.

Your post is about as well though out as your racist diatribes.
Yeah, cash dividends aren't expected with facebook anytime soon. No shit, investors expect facebook to ultimately start paying dividends, but there's no promised dividend with this IPO. Your post sounds really uninformed and retarded.

[FuzzyLumpkins]

Yeah, cash dividends aren't expected with facebook anytime soon. No shit, investors expect facebook to ultimately start paying dividends, but there's no promised dividend with this IPO. Your post sounds really uninformed and retarded.

A question sounds uninformed? That was very insightful oh ye assessor of intelligence.

And actually as CC pointed out there is a trend in tech stocks to offer no dividends whatsoever so who knows what investors will 'expect.' This isn't the 1960s anymore even if CC sounds like hes a little girl at Shea everytime the first few bars of a song are played.

[CosmicCowboy]

A question sounds uninformed? That was very insightful oh ye assessor of intelligence.

And actually as CC pointed out there is a trend in tech stocks to offer no dividends whatsoever so who knows what investors will 'expect.' This isn't the 1960s anymore even if CC sounds like hes a little girl at Shea everytime the first few bars of a song are played.

It's not just tech stocks. There is a whole category of stocks that pay little or no dividend that are called GROWTH stocks. They can be in many businesses including banking, real estate, energy, etc. And for your information, Steve Jobs didn't invent the growth stock category.

[FuzzyLumpkins]

It's not just tech stocks. There is a whole category of stocks that pay little or no dividend that are called GROWTH stocks. They can be in many businesses including banking, real estate, energy, etc. And for your information, Steve Jobs didn't invent the growth stock category.

I never said that he did. I was referring to a speech he made when he claimed that it was 'cutting edge.'

[Goran Dragic]

A question sounds uninformed? That was very insightful oh ye assessor of intelligence.

And actually as CC pointed out there is a trend in tech stocks to offer no dividends whatsoever so who knows what investors will 'expect.' This isn't the 1960s anymore even if CC sounds like hes a little girl at Shea everytime the first few bars of a song are played.
A stock's price is supposed to be the sum of the NPV of all future dividends (google "Gordon Growth Model" before you acuse me of making that up). The tech stocks CC is referring to never reach the stage where dividends provide the shareholder more returns than reinvesting earnings (since tech stocks are high growth), but their price is still reflective of the dividends the stock might yield once it is more mature and done growing, however far away that may be.

And your question wasn't what I called uninformed, your response to the answer I tried to give was. When companies have an IPO it's in order to raise capital for expansion/reinvestment. Those companies don't pay dividends when reinvesting produces high returns. This isn't something I'm saying to mimic CC, it's one of the most basic concepts in finance :lmao

[FuzzyLumpkins]

:lol supposed to be

[boutons_deux]

Facebook Will Avoid Paying $16 Billion In Taxes After Going Public


As ThinkProgress has noted, Facebook’s initial public offering will help both CEO Mark Zuckerberg and the company itself avoid billions of dollars in taxes. With Facebook’s offering now in the books, as Bloomberg’s Paula Dwyer wrote, the company is set to officially save $16 billion in taxes by deducting the cost of stock options granted to owners and employees. “The tax windfall will be the largest ever claimed by a company for stock option awards,” Dwyer wrote. “Facebook is an American success story. Its ability to use a stock option loophole to zero out its U.S. tax bill, despite ample profits, makes no sense. It also isn’t fair to the rest of American taxpayers who will have to pay more because Facebook pays nothing,” said Sen. Carl Levin (D-MI).

http://thinkprogress.org/economy/2012/05/18/487090/facebook-16-billion-taxes/

====

Those Corporate-Americans are exactly like Human-Americans.

[CosmicCowboy]

Hmm...heard from a friend in the biz that a lot of those $42 buys being posted are NASDAQ still settling trades from it's totally fucked up opening this morning. He said there may be a HUGE class action suit against them. A shit load of money apparently got lost today because brokers couldn't get trade confirmation.

[Cant_Be_Faded]

I bought into the hype :/

hope I don't get burnt on Monday

[ChumpDumper]

I bought into the hype :/

hope I don't get burnt on MondayThat seems inevitable.

I might buy in after the fall and when these guy explain to shareholders how they plan on making astronomically increasing their income.

[coyotes_geek]

Hmm...heard from a friend in the biz that a lot of those $42 buys being posted are NASDAQ still settling trades from it's totally fucked up opening this morning. He said there may be a HUGE class action suit against them. A shit load of money apparently got lost today because brokers couldn't get trade confirmation.

Certainly not a good day for the nasdaq.

[coyotes_geek]

I might buy a coke with the proceeds after the commissions.:lol

A profit is a profit. :)

[CosmicCowboy]

My friend confirmed there was an unlimited buy order on the screen all day long to buy all shares offered at $38. One can only assume that it was placed by the underwriters.


:lmao

I'm thinking the underwriters own a shitload of Facebook stock.

[mavs>spurs]

Fuzzy me and dok are both top of our class as finance guys and I can assure you he's right. Companies don't start paying dividends immediately after going public especially not Facebook in this case. The point of going public is to raise capital.

[Wild Cobra]

Any guesses on how Randolph and Mortimer did?

[Spurtacus]

I bought into the hype :/

hope I don't get burnt on Monday

how many shares?

[mavs>spurs]

I bought into the hype :/

hope I don't get burnt on Monday

lmao you absolutely will. the underwriters knew that it wasn't worth nearly that much when they got themselves into this, they were relying on stupid people like you to go out and buy long enough for them to unload all their shares and it backfired. now that the cat is out of the bag, look for it to tank like a mofo.

:lol so how much did you invest in it?

[Venti Quattro]

So what will be Facebook's revenue stream aside from ads? I'm not buying the Facebook IPO hype. They'll probably blow so hard within the next 3 years.

[mavs>spurs]

So what will be Facebook's revenue stream aside from ads? I'm not buying the Facebook IPO hype. They'll probably blow so hard within the next 3 years.

obviously. it's human nature to get bored and go on to something else..facebook won't be around in 5 years

[Venti Quattro]

Or they'll try to stay in the game and morph to something else, and still fail.

[FuzzyLumpkins]

Fuzzy me and dok are both top of our class as finance guys and I can assure you he's right. Companies don't start paying dividends immediately after going public especially not Facebook in this case. The point of going public is to raise capital.

Oh I get it. It's done to make money. I just think that speculating on nothing is silly even if it is how things are typically done nowadays. I am just not into style over substance and this IPO reeks of it.

[Cant_Be_Faded]

lmao you absolutely will. the underwriters knew that it wasn't worth nearly that much when they got themselves into this, they were relying on stupid people like you to go out and buy long enough for them to unload all their shares and it backfired. now that the cat is out of the bag, look for it to tank like a mofo.

:lol so how much did you invest in it?

Not much, I will prob unload it early Monday at a loss, but nothing too crazy unless it gaps down like a mother fucker.

[mavs>spurs]

I am just not into style over substance and this IPO reeks of it.

Exactly, facebook's intrinsic value is nowhere near what they are trying to sell it at. And even if facebook was making that kind of money, which it's not, anyone with half a brain would question its ability to maintain such a status as social networking fads are cyclical.

[mavs>spurs]

Not much, I will prob unload it early Monday at a loss, but nothing too crazy unless it gaps down like a mother fucker.

:lol how much is "not much?" somebody sounds a little secretive i saiddddd!!!

[Cant_Be_Faded]

:lol how much is "not much?" somebody sounds a little secretive i saiddddd!!!

Bout half a G
I'll prob lose about one hour of work, but money is money

You really think I'd be stupid enough to pour a ton into this?

[Drachen]

anyone buying puts on monday?

[mavs>spurs]

from your postings on this site i honestly wouldn't have any clue, it wouldnt surprise me totally. you never know someone from their internet persona's so idk.

[Cant_Be_Faded]

Lol....maybe I should be constantly posting about how im going to make more money than everyone on the board because im getting As at UT Arlington

[mavs>spurs]

i'm tempted to write some calls and pocket some easy money but i'm scared with the way something like this can be so random and volatile. sure enough as soon as i wrote a call, the underwriters would have a trick up their sleeves and it would get exercised before the stock tanked back down.

[mavs>spurs]

Lol....maybe I should be constantly posting about how im going to make more money than everyone on the board because im getting As at UT Arlington

or maybe you should do the exact opposite and advertise how stupid you are rather than how smart.

"herp durp, im gonna buy facebook her durp!"

:lmao

[Cant_Be_Faded]

I went through my cocky college phase a long time ago, you just weren't posting here at the time.

Yeah it sucks to lose money, but im sure you're so smart you plan on never losing money in any trade for the rest of your life right? #possible

[mavs>spurs]

Dude, i'm not even going to be hard on you. You're really not so bad. I'll let you in on a little secret, the school smack thing is a joke between me and fkla we are just fucking with eachother. I'm sure I'm not the only one who's ever made good grades at an average school. my plans are a lot bigger than UTA.

in real life i'm not that big of an asshole i just expect to make a living thats all. everyone makes mistakes, but you really should think long and hard before you make any investments. it's even harder today for an individual who isn't "in the know" if you know what i mean to outperform the market with all the market manipulation and computer trading that goes on. they are constantly trying to prey on the household investors and thats why they hyped this thing up so much, knowing damn well facebook isn't worth 100 billion dollars.

[DUNCANownsKOBE]

rofl m>s's thing really is just a persona.....from the conversations I've had with him he's a way more modest person than I am.

[Wild Cobra]

I just hope the day traders lost big.

[mavs>spurs]

dok what do you say we write some out of hte money calls i saiddddddd

[DUNCANownsKOBE]

I wanna buy some of dem put options. Naked calls are too risky for me especially with a volatile stock like det.

[coyotes_geek]

Down to $37 in pre-market.........

[CosmicCowboy]

Down to $35 now

[coyotes_geek]

$33......

[mavs>spurs]

Shoulda bought the damn puts..Sucks knowing how to make money but being too much of a broke college student to act on it

[CosmicCowboy]

LOL, dropping like a turd from a tall horse...

[Cant_Be_Faded]

Phew, got out before to much shit hit the fan

[CosmicCowboy]

Looks like it finally found a real floor in the 33 range down 12%. I had the pricing right but didn't anticipate the underwriters falling on their swords to protect facebook like that.


I don't see any fucking way it's worth that much. If it opens at $38 this morning, where do you think it will be when the bell rings this afternoon? I'm thinking down at least 10-15%...

The WSJ is reporting the brokerages involved in the deal suffered "significant" losses.

[boutons_deux]

and yet "(orgiastic) greed is good" :lol

[coyotes_geek]

I can only imagine how many insiders are counting the days until the lockup period expires. :lol

[Venti Quattro]

:lol 10% down

[TeyshaBlue]

I can't believe I even tried to make a play with FB. Even more unbelievable is I didn't get my ass burnt completely off.

[mavs>spurs]

I don't think it should be done tanking honestly.

[hater]

$25 would be a fair price. Anything more and its a rip-off

[mavs>spurs]

^what model did you use to derive that?

[Fabbs]

just going by gut, Zuckersuck and his pals have always seemed a pack of devious skunks to me.
Glad i avoided.
Sorry about those of you who jumped but glad to read most of you got out quickly.

[baseline bum]

What the fuck is this going to be trading at by noon Monday? :lol

So it was $33.81 at noon. Damn, it would have been nice to have bought a grip of put options. :(

[hater]

^what model did you use to derive that?

the real valuation came up to $28 before the banks and Zuckadick proped it up to rob the dumb motherfuckers

even $28 is too high. But I think at $25 ppl would actually buy it

[mavs>spurs]

So it was $33.81 at noon. Damn, it would have been nice to have bought a grip of put options. :(

I told u all to if u read the thread

Edit dok did, I agreed

[CosmicCowboy]

http://blogs.wsj.com/marketbeat/2012/05/21/facebook-shares-tumble-where-are-the-underwriters/?mod=WSJ_qtoverview_wsjlatest

May 21, 2012, 10:28 AM
Facebook Shares Tumble: Where Are the Underwriters?


As Facebook shares tumbled below their IPO price on the second day of trading, the bankers’ role in supporting the stock price is taking center stage.

The shares, which recently traded at $33.65, down 12%, repeatedly tested its $38 initial public offering price during its debut on Friday, with lead underwriter Morgan Stanley (MS) reportedly stepping in to keep the stock from breaking through its offer price. A Morgan Stanley spokesman on Friday wouldn’t confirm or deny the bank’s role in keeping the stock above its $38 level on the first day; the stock ended Friday up less than 1%.

As the stabilization agent on the deal, Morgan Stanley fills the role of ensuring an orderly market in the stock in its first days of trading.

Though it’s under no legal obligation to prevent a company from declining below its IPO price, on most major offerings, the lead investment bank will step in and start buying shares of a stock to keep shares at least flat with their IPO price at the close of trading. That support can continue beyond the first day, depending on the deal and the bank.

The method used to provide this stability relies on an underwriting agreement known as the over-allotment option that gives the bankers the ability to buy or sell an additional chunk of shares as needed. The typical share amount in an overallotment is 15% of the total offering, which was the case in Facebook, giving underwriters an extra cache of 63.2 million shares to use as a means to support the stock.

The process is common in IPOs and works like this: The underwriters have the extra shares available to either sell or buy for a period after the IPO. If demand is strong, they sell them like all the other shares. But if the stock price falls, they can buy them back, effectively creating a floor for the price.

However, Facebook’s total shares sold–421.2 million–combined with heavy first-day trading volume–means that bankers’ ability to buy had a limit.

Morgan Stanley didn’t immediately return calls Monday seeking comment on supporting the stock.

[boutons_deux]

Why Facebook's stock is tanking

Reality has taken hold. The company's valuation is still out of whack, despite its massive user base.

http://news.cnet.com/8301-1023_3-57438348-93/why-facebooks-stock-is-tanking/?tag=nl.e703

[Goran Dragic]

When a company has as much expected growth as facebook does, there's basically no way to justify the quarterly decline in revenue it just had.

:lol anyone who thinks Zuckerberg gives a shit about shareholders
:lol anyone who thinks Zuckerberg won't sharply decrease his stake in FB after the lockup period is over

[boutons_deux]

"as much expected growth"

.... revenues, not only in members and page hits.

[Wild Cobra]

$25 would be a fair price. Anything more and its a rip-off
I'm thinking $25 is too high, but that is admitted bias rather than knowing their probable financial future. I just do not see money to be make for stockholders in this type of site.

I'll take bottom fishing for $19.

[coyotes_geek]

Low $20s is in the ballpark, but I wouldn't even begin to think about touching it until after the lockup period is over.

[TDMVPDPOY]

it already dropped about 15% on open trading day...lol hype

[coyotes_geek]

(Reuters) - In the run-up to Facebook's $16 billion IPO, Morgan Stanley, the lead underwriter on the deal, unexpectedly delivered some negative news to major clients: The bank's consumer Internet analyst, Scott Devitt, was reducing his revenue forecasts for the company.

link (http://news.yahoo.com/insight-morgan-stanley-cut-facebook-estimates-just-ipo-051601330--sector.html)

[TeyshaBlue]

lol. Surprise!

[coyotes_geek]

lol. Surprise!

I'll bet that coke you bought tastes pretty damn good right about now. :)


I might buy a coke with the proceeds after the commissions.:lol

[TeyshaBlue]

lol....yup. I was pretty sure it was gonna run up on hype, let me make about 20-30% and dump. Glad I only played a 100 share buy and got out with a tiny gain. lol @ Morgan Stanley with about a bazillion shares and about zero hope of recovering.

[Yonivore]

I guess the answer to the OP question, "So, is Facebook worth $38 a share?," is a resounding NO.

[CosmicCowboy]

:lmao

Down another 5% @ 32.

[Goran Dragic]

Low $20s is in the ballpark, but I wouldn't even begin to think about touching it until after the lockup period is over.
This. Lets see what the price is after insiders flood the market with sell orders.

[cheguevara]

And now comes some news about the Facebook (FB) IPO that buyers deserve to be outraged about.

Reuters' Alistair Barr is reporting that Facebook's lead underwriters, Morgan Stanley (MS), JP Morgan (JPM), and Goldman Sachs (GS) all cut their earnings forecasts for the company in the middle of the IPO roadshow.

This by itself is highly unusual (I've never seen it during 20 years in and around the tech IPO business).

But, just as important, news of the estimate cut was passed on only to a handful of big investor clients, not everyone else who was considering an investment in Facebook.

http://finance.yahoo.com/blogs/daily-ticker/facebook-bankers-secretly-cut-facebook-revenue-estimates-middle-133648905.html



:lmao :lmao :lmao :lmao :lmao :lmao

Royally fucked by the banks

:lmao Obama/Romney best friends for Morgan Stanley/JP Morgan/And Goldman Sachs

:rollin

[cheguevara]

once that piece of news reaches the masses, I expect Facebook to plummet to under $20

[TeyshaBlue]

I thought it was pretty hilarious when GM announced they were pulling their advertising from FB a day before the IPO.

[Goran Dragic]

once that piece of news reaches the masses, I expect Facebook to plummet to under $20
:lol imagine how much money those 3 will lose on this IPO after all the class action suits they're about to get hit with.

[cheguevara]

If there was any communication at all between Facebook and its underwriters regarding the analysts' estimates, Facebook will likely be on the hook for this, too.

LOL Commiting crimes on day 1 of your IPO

[Drachen]

damn, why can't I buy puts!

[Goran Dragic]

Prolly cause no one in their right mind wants to take a short position on puts :lol

[hater]

just zuckerberg working on part 2 of The Social Network

he'll probably make more money from the movie than his stock :lol

[Drachen]

Prolly cause no one in their right mind wants to take a short position on puts :lol

LOL, agreed.

However there is no option chain at all. Anyone know if this has something to do with the IPO.

[CosmicCowboy]

Words out that Morgan Stanley bought almost 40 million shares Friday at $38.

Ouch.

They got a 68 million fee for underwriting it and have lost almost 200 million on the stock so far.

[CosmicCowboy]

http://finance.yahoo.com/news/facebooks-stock-struggles-fingers-start-110106287.html


Wall Street is playing the Facebook blame game.
As shares of the social network tumbled in their second day of trading, bankers, investors and analysts wondered what had gone wrong with the initial public offering of Facebook, the most highly anticipated technology debut in years.
Some fingers are pointing at Morgan Stanley, the lead banker on the I.P.O., while others criticize Nasdaq and even Facebook itself. In the aftermath, critics contend that Facebook's offering price was too high and too many shares were sold to the public, hurting the stock's performance out of the gate.
Facebook's troubles could damp enthusiasm for a spate of companies set to go public in the coming months. It could also spur changes in the I.P.O. process. In particular, big institutional investors like Fidelity and Vanguard may demand greater say on pricing, at the expense of companies and their bankers.
"It's a huge disappointment," David J. Abella, a portfolio manager at Rochdale Investment Management who tried to get shares in the offering but did not get an allocation. "Investors were expecting easy money on this one."
Facebook was promoted as the next Google, a technology star primed to soar.
But the stock stumbled in its debut on Friday. A systems error at the Nasdaq, where shares of Facebook are listed, hampered trading in the first few hours. With the company hovering around its offering price of $38 a share, Morgan Stanley had to step in to help stabilize the price. Facebook shares ended the day almost at the same place they started.
While bankers may have hoped that Facebook would bounce back on Monday, unfettered by technical problems, such optimism faded as the stock sank. It tumbled 11 percent, closing at $34.03.
For Morgan Stanley, landing the Facebook public offering was one of the biggest investment banking coups in almost a decade, and a successful debut would most likely have cemented its position as the dominant force in technology I.P.O.s. But Morgan Stanley now faces questions about its role in the events surrounding Facebook.
It is an unusual situation for the bank to find itself in. In the last year, it led the biggest technology offerings, including those of LinkedIn, Groupon and Zynga. The activity has been lucrative for the firm, with the Facebook I.P.O. alone bringing in an estimated $67.8 million, according to Standard & Poor's Capital IQ.
But the firm has also gained a reputation for being guarded. A number of bankers involved in the Facebook I.P.O. and other offerings have said Morgan Stanley makes decisions with little input from other underwriters. Rivals involved in the Facebook underwriting process say that Morgan Stanley exerted an enormous amount of control over important aspects of the process, including dominating meetings with institutional shareholders.
These bankers also say that Morgan Stanley bankers and Facebook executives ignored some input about pricing. Amid rising investor demand before the I.P.O., Morgan Stanley contacted other bankers to discuss raising the offering price as high as $38 a share, up from the original estimates of $28 to $35 a share.
Some of the firms resisted, arguing that the company's fundamentals did not justify a higher valuation, according to people with knowledge of the talks. The rival bankers also worried that the outsize demand was being driven by retail investors, a more fickle constituency. But others involved in the underwriting say that Morgan Stanley and other advisers held thousands of conversations with potential investors on what was a fair level, and that the $38 price was justified.
For Morgan Stanley, one of the main goals was to avoid an enormous "pop" in the first day of trading, a sign that an offering may have been priced too low. LinkedIn, for instance, nearly doubled in its first day of trading. Generally, bankers favor a more modest rise, say 10 percent, balancing the needs of both new investors who want big gains and current insiders who do not want to leave money on the table.
"The range and the size of Facebook's offering was not increased through careful observation by Morgan Stanley and its underwriters," said Nick Zaharias an independent consultant, who advises institutional investors. "It seems like Morgan Stanley lost control of the process."
But much of the frustration with the I.P.O. process did not boil over until Friday morning. When Nasdaq started determining Facebook's opening price, the exchange's systems were quickly overwhelmed by enormous demand from investors. Trading in the company was delayed by a half-hour, to 11:30 a.m. But many trade confirmations were not sent out until at least 1:50 p.m., meaning that many investors were flying blind.
To several bankers, that was a recipe for disaster. As the lead underwriter and stabilization agent, Morgan Stanley was obligated to steady the trading in Facebook stock should it falter. The firm's traders bought an estimated 30 million to 40 million shares at $38 that day, hoping to prevent the stock from breaking below the offer price, according to people involved in the process.
That exercising of the overallotment option, known as the "green shoe" in Wall Street parlance, normally succeeds in keeping a stock from veering too far from the offer price.
But the defense mechanism is unlikely to prove effective for long, given the size of Facebook's offering and the heavy trading. Morgan Stanley had just 63 million shares to exercise. By comparison, more than more than 571 million Facebook shares changed hands on Friday and 168 million on Monday.
"It is like fighting a war with a water gun, it wasn't that effective," one banker involved in the underwriting process said.
Investors also had to digest a string of troubling news items that recently emerged. A week before its debut, Facebook revised its prospectus, highlighting the challenge of making money in mobile communications. Then, on May 15, General Motors, one of the country's largest advertisers, said it was withdrawing its $10 million Facebook ad budget.
Some institutional investors were also surprised by the size of their allocations, expecting to get far fewer shares. In the process of jockeying for I.P.O. shares, investors will typically ask for a large block, even if they expect to only receive a fraction.
"We got more shares than we expected, which spooked us," said one portfolio manager, who spoke on the condition of anonymity for fear of upsetting Facebook's underwriters. Concerned that the size of its allocation implied a lack of broad investor support, the manager sold all of the firm's Facebook's shares on Friday. "If it was truly a hot, hot deal, we would have gotten less."
Facebook's disappointing debut may not bode well for other I.P.O.'s. There are dozens of public offerings in the pipeline, according to Thomson Reuters, including some well-known names like Michaels Stores and Shutterstock, an online stock photography service.
Institutional investors like Fidelity Management, burned by Facebook's tumble, may drive a harder bargain in the future.
Still, the final story for Facebook's stock has yet to be written. Amazon.com quickly tumbled after making its public market debut in May 1997, trading well below its offer price of $18 a share for several months. A year after the I.P.O., Amazon had roughly quadrupled, and on Monday the shares closed at $218.11.

[coyotes_geek]

LOL, agreed.

However there is no option chain at all. Anyone know if this has something to do with the IPO.

I could be completely wrong here, but I've got it in my head that a stock has to trade for 30 days before options become available.

[CosmicCowboy]

I could be completely wrong here, but I've got it in my head that a stock has to trade for 30 days before options become available.

There is no set time...it is determined arbitrarily by the underwriter...usually it's 30-60 days on big IPO's but you have to ask yourself...

If you were Morgan Stanley and owned 1.5 BILLION DOLLARS of Facebook stock, would you be in a hurry to let the short traders in to play?

[coyotes_geek]

Thanks for the clarification.

...and no. I would not be in a hurry to turn loose the shorters. :lol

[Goran Dragic]

There is a restriction on shorting right after the IPO but anyone who can issue call or put option of they want to. The reason why we're not seeing any is probably 1) the lack of people who want to be writing put options on facebook 2) it being almost impossible to value the price of a FB option right now because it would be even more approximating and estimating than what's already done when valuing an option. Just one big example being facebook's volatility. The only way one could value facebook's volatility right now is basing it off the volatility of comparable companies which is not reliable.

[TDuncan4]

I don't understand how Facebook makes its money on ads. Who actually clicks on those things anyway?

[Yonivore]

I don't understand how Facebook makes its money on ads. Who actually clicks on those things anyway?
There are ads?

[Wild Cobra]

There are ads?
I thought they made their money by selling email information and other data.

[CosmicCowboy]

:lol

The 5 day chart is appalling. Goes right off the cliff after the IPO. I tried to link it but it breaks. Morgan Stanley is in deep shit over this one...

[CosmicCowboy]

http://static7.businessinsider.com/image/4fbbfd6869beddbe64000002-590-/chart-of-the-day-facebook-stock-may-2012.jpg

[coyotes_geek]

Little bit of a dead cat bounce going on today???

[CosmicCowboy]

Yeah it opened up a little but I think the short term trend is still down. With all the talk in the mainstream news about how Morgan Stanley screwed the pooch on the IPO they may be interceding this morning trying to stop the slide and limit the damage before all the retail rats jump ship.

[leemajors]

Suit over IPO:


http://www.huffingtonpost.com/2012/05/23/facebook-zuckerberg-banks-sued-ipo_n_1538951.html?ref=tw

[MannyIsGod]

Seems like stupid shareholders are now just pissed that they were stupid.

[boutons_deux]

Morgan Stanley to adjust prices on some Facebook trades

Morgan Stanley told brokers on Wednesday that it is reviewing every Facebook Inc. trade and will make price adjustments for retail customers who paid too much during the social network company's debut last week, according to an internal memo.

In the memo, Morgan Stanley, lead underwriter of Facebook's initial public offering Friday, also said "many" of the first-day trades have now been processed and are appearing in client accounts. The company did not specify how much it expected to pay in total price adjustments.

"All orders are currently being reviewed for best execution pricing," the memo obtained by Reuters said. "We expect there will be a number of price adjustments. The largest adjustments will be processed first over the next several days and the remaining adjustments will be completed as quickly and as thoroughly as possible."

A "very limited number of orders" are pending, but Morgan Stanley told its more than 17,000 brokers that it expects to have remaining orders resolved and booked Wednesday.

Morgan Stanley confirmed the contents of the memo but declined to elaborate.

Facebook's highly anticipated market debut Friday was beset by trading glitches on the Nasdaq stock market. The opening of trading in the social networking company's new shares was delayed by about 30 minutes. Shares priced by underwriters at $38 briefly rose to $45 in early trading but then fell to end little changed Friday.

A significant number of investors at Morgan Stanley and other brokerages were left in limbo -- some as late as Tuesday -- with trade orders that were not processed.

http://mobile.chicagotribune.com/p.p?m=b&a=rp&id=2167100&postId=2167100&postUserId=54&sessionToken=&catId=5551&curAbsIndex=0&resultsUrl=DID%3D6%26DFCL%3D1000%26DSB%3Drank%2523 desc%26DBFQ%3DuserId%253A54%26DFC%3Dcat1%252Ccat2% 252Ccat3%26DL.w%3D%26DL.d%3D10%26DQ%3DsectionId%25 3A5551%26DPS%3D0%26DPL%3D3

[mavs>spurs]

it's just hilarious that a couple of college kids on spurstalk.com predicted all this months in advance while all these assholes got burned

[Drachen]

There is a restriction on shorting right after the IPO but anyone who can issue call or put option of they want to. The reason why we're not seeing any is probably 1) the lack of people who want to be writing put options on facebook 2) it being almost impossible to value the price of a FB option right now because it would be even more approximating and estimating than what's already done when valuing an option. Just one big example being facebook's volatility. The only way one could value facebook's volatility right now is basing it off the volatility of comparable companies which is not reliable.

http://finance.yahoo.com/news/short-sellers-lining-bet-against-192710970.html

[boutons_deux]

The Facebook IPO Clusterfuck

"Facebook," he said, "is a colossal example of a complete clusterfuck where everybody wins except the ordinary investor."

Sooner or later, people are going to clue into the fact that one or two big banks, acting in concert with a choice assortment of unscrupulous "preferred investors," can at least temporarily prop up or topple just about anything they want, from Greece to Bear Stearns to Lehman Brothers. And if you can move markets and bet on them at the same time, it's impossible to not make tons of money, which incidentally is made at everyone else's expense. So we should always be on the lookout for any evidence that that sort of coordinated, non-disclosed activity is taking place.

http://readersupportednews.org/opinion2/279-82/11583-the-facebook-ipo-clusterfk

[cheguevara]

:lmao you just can't make this shit up

Less than a week after Facebook's (FB) IPO there are already rumors that Facebook is considering a move from the Nasdaq (NDAQ) to the NYSE (NYX).

According to Peter Schiff of Euro Pacific Capital, switching exchanges will accomplish nothing for Facebook.
"The problem isn't where it's listed—it's the valuation!" says the author of The Real Crash.


LOLOLOLOLOLOL

[mavs>spurs]

Nobody is willing to pay for this crap or at least won't for much longer because of one thing they keep pretending to forget: THE GOING CONCERN ASSUMPTION. People are already starting to deactivate their accounts and curb use, Facebook won't be around forever. It's a social media website, they come and go.

[ChumpDumper]

People are already starting to deactivate their accounts and curb useLink?

[mavs>spurs]

http://www.pcmag.com/article2/0,2817,2386884,00.asp

I've been noticing it for a while tbh friends list slowly dwindles as people deactivate there's way less traffic lately too.

[mavs>spurs]

There's all kinds of info out there really if you don't have a Facebook to see it yourself

http://news.sky.com/home/technology/article/16011463

A lot of my friends have shut theirs down I'm also considering it

[ChumpDumper]

http://www.pcmag.com/article2/0,2817,2386884,00.asp

I've been noticing it for a while tbh friends list slowly dwindles as people deactivate there's way less traffic lately too.I think there may be other reasons you have fewer friends.

lol June 2011