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if the underwriters simply get a fee and don't actually take possession of and resell the shares, then why did UBS lose 350 million trying to unload shares?
http://www.cnbc.com/id/47739332
My instinct first told me that bottom fishing for it was good at $19. Then I read the article that their assets are only worth $7.50.so we had a discussion about facebook stock today in my finance class. my professor who is a phd and averages a 20% return on the market every year for the past 20 years and worked as a trader in the past says that it should be worth somewhere between 8 and 20 dollars
he wasn't sure specifically because he doesn't care about facebook, but did manage to make a little money off the ipo and got out as quickly as possible
Alex... I'll take bottom fishing for $15.
I agree... that's midway between his range. But what do I know about valuing stocks... that's just a wild ass guess tempered with instinct.
if the underwriters simply get a fee and don't actually take possession of and resell the shares, then why did UBS lose 350 million trying to unload shares?
http://www.cnbc.com/id/47739332
If you would go back and read the earlier posts in the first few pages I already explained. It was pride and good PR...as the underwriter they felt obligated to support the $38 floor the first day. Underwriting is big business for thee guys...if they hadn't supported the stock price it would have killed their reputation and their underwriting business.
BTW, UBS was not the underwriter. They bought the shares...now claiming they bought them "accidentally" by repeating the buy order because they didn't get confirmation of previous buy orders being filled.
I wonder how many people listened to Sam Hamadeh on the 17th?
Confirmed: Facebook sets $38 share price for largest tech IPO in U.S. history
At $38 a share, Facebook is likely an excellent buy for the investor who can flip her shares as the stock initially pops on the public market. But does the $38 price and a $104 billion valuation accurately reflect Facebook’s fair value?
Not a chance, PrivCo chief executive Sam Hamadeh told VentureBeat earlier. He said the initial offering price may be a minimal risk for those who want to turn a quick profit, but long-term investors should be wary. A backslide is inevitable, he said.
PrivCo, which tracks the financial data of private companies, believes that Facebook’s fair value rests between $24 and $25 a share. The company arrived at these numbers with two different methods: using enterprise value to revenue multiples (based on comparable public companies) and a discounted cash flow calculation that modeled out the next four years of Facebook’s costs, revenues, and net incomes.
Hamadeh predicts that, following several events he expects in the coming year, Facebook’s stock price will fall closer to this $25 “fair value” by year’s end.
One such event: a missed earnings report. Facebook will disappoint investors when it reports its second-quarter and third-quarter 2012 earnings, Hamadeh predicted. “The projections that people have for this company are so inflated at this point, Facebook can’t help but miss,” he said.
“After it returns to fair value, then the stock will grow as the company grows,” Hamadeh said. “It could take two or three years to get back to its IPO price.”
Bump. Facebook earnings tomorrow. Could get ugly. ZNGA just announced and they missed badly. FB already taking a pretty big hit in after hours trading as collateral damage.
Isn't FB preparing some kind of settlement for the traders that got trapped @ $40 while the stock tanked but due to technical errors couldn't unload it?
Oh, that was NASDAQ offering up the settlement.
http://allfacebook.com/nasdaq-greife...initive_b95475
Looks like they made way more money than was expected.
LOL, still drops $2.50 today.
Oops, make it almost $5.50 so far counting after hours trading.
Almost 20%... Ouch.
Worse news for Zynga.
They lost money
http://www.marke ch.com/story/fac...dist=afterbell
Revenue looked okay, but they still need to figure out how they're going to make money off of mobile users. Valuation on the stock is still horribly out of whack though.
SMH they LOST money? CNN fails again?
CNN may have just been reporting that revenues increased, which is a true statement.
Down close to 15% since yesterday's close
Their P/E ratio is at 57 which is still pretty high. IMO their P/E should be around 30.
How is my "bottom fishing for $15" looking?
I haven't watched or read enough details to put money into it, but between it's actual asset value, and normal PE ratio's, I think it will bottom at $15 before a stable company is formed, then top out at around $20.
I don't like Facebook as an investment in the long run. I don't think it is a brand that will last. Their management is sub par. They still have not transitioned well to mobile, and they are not making enough money on the users they already have. They also have to compete against Google, who can easily outlast them as Search is their main business, and business is good.
Facebook hits new low as IPO lock up ends
Shares of Facebook are plunging to all-time lows after the expiration of a lock-up period that has provided early investors and insiders with an opportunity to exit.
The stock fell 7 percent, or $1.49, to $19.71 in Thursday morning trading.In all, 271 million shares will become eligible for sale Thursday, on top of the 421 million already trading.
Out of s and grins, I'll say $15.38.
I dunno. I think FB might tread water here in the 18-22 range until the next earnings release.
And to you think the next earnings release will be better?
I don't.
Give my prediction till just after the quarter ending in June next year.
hard to say. last quarter they had a one time charge that meant the difference between profit and loss, so unless they've got another one time charge lined up they should be profitable this quarter. of course if they're not "profitable enough" to make the big fish happy then $15 or lower is still easily doable.
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