WatchI have enjoyed watching the whole FB thing unfold, partly schadenfreude, I guess, but it's also just interesting (the RedHat IPO was the last one I watched so closely)
Anyway, there has been a lot of talk about the lockup provisions expiring and the potential for the market to get flooded by people who hold stock that has been so far held off the market.
In summary:
Up to 1.91 billion more shares could flood the stock market — more than four times the 421 million shares that had been trading since Facebook’s initial public offering in May.
IPO: 421 million
Thursday: 271 million shares held by early investors and directors
Unspecified date between Oct. 15 and Nov. 13: 243 million shares and stock
Nov. 14: 1.22 billion shares and stock options, about a third of which is controlled by Zuckerberg.
Dec. 14: 149 million shares held by early investors and others who participated in IPO, except Zuckerberg.
May 18, 2013: 47 million shares held by early investors
That seems like a lot to me. Obviously it's unlikely that everyone is going to dump all of their holdings (particularly Zuckerberg), but this doesn't seem good for the stock price.
It will be interesting to watch.
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tiny tina says
Tina,
Thanks for jumping in, but this is not a good proposal. Patrick would lose readership. Serpentor might have deep pocket, but I only have a short stack at the moment. I can afford to lose $10k without losing sleep over it because $100k of capital will be making me $10k-$12k cash on cash return a year, and that doesn't even taking into account the appreciation of the investments, which have been tremendous thanks to my lucky guess. :)
Cheers.
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E-man says
I will die working at my old age and just loving it.
We have alot to do, to get SV back to its mojo!
.... more now than ever!
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Been busy vacationing. Only equity play was some Apple calls. I dislike FB but this doesn't translate into a burning desire to play short.
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They are more safer ways to earn money, where you will at least not lose principle if the investment fails to return you a profit.
I think the chances are very good though for anyone shorting it to make a decent coin BUT...
That's if the stock doesn't get manipulated, the books don't get cooked and Fuckerberg doesn't play any funny business.
Which he is and will continue to do.
But honestly... At this point in history, you should just focus on saving money, preserving what you have and protecting your wealth along with preparing for the future gloom.
Making money today is very very VERY hard in investment. Almost impossible...
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Vicente says
Nice. I don't really care for FB. I've never been on Facebook. My wife goes on there occasionally to reconnect with relatives back home. Other than that, eh.... who cares. I love RE and will stick with this hard asset play for a while.
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I have to agree with E-man on this. Those who say they are sure that a company is going to have its share price drop should put their money where their mouth is...
at least short the company / sector if you are so sure.
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I heard google+ is better than facebook, just currently more or less undiscovered. Facebook was founded on popularity contests, when that contest ends so does the company.
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Fuckerberg made a big mistake for not selling to Google for a couple billion dollars which was a VERY VERY high offer & very generous of them.
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I do not have a Facebook account (thank you very much) but any moron with one has little room to talk about it or those behind that idiotic bullshite.
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E-man says
These other guys don't have deep pockets, other than for pretend on the Internet. Hell, Serpentor offered to bet $100k, and then scoffed at having $100 cash these days. You would think someone willing to bet that much, might have that little lying around. I knew they would never accept a $10k bet, and now they won't accept a $0 bet. Apparently, you will have to pay them to bet you.
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Facebook's model for ads is flawed. Google ads work because people use google to search. You get advertisements based on what you are searching for. People on facebook are commenting on everyone's photos in their most recent night of drinking. Google advertising actually works. An old classmate of mine pays Google 5k a month for advertisements and told me, he estimates that it generates 15k in revenue for him each month. Facebook, everyone ignores the ads.
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tiny tina says
wrong. first I said I don't carry that kind of cash on me. (most people use credit cards these days) then on a later post I offered the $100k bet. are you and e-man the same person?
there's a lot of sarcasm by you and E-man regarding the FB bears, but no legit reason why you disagree. Do you own FB? why not? if you think its a good investment, why not put your money where your mouth is?
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Serpent,
Betcha that you're an engineer, and they are not. I have noticed it myself, the further away from the technology that people are, the bigger "Silicon Valley" cheerleaders they become.
Heck, FB is not even a tech company. It's a media company. More like Madison Avenue than Silicon Valley.
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theoakman says
who cares? no one ...LOL! its all a bunch of hype over advertising nonsense.
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Serpentor says
That's low. I couldn't believe it came from you.
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theoakman says
I hope he is selling something with high margins.
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Serpentor says
You said $100 was chickenshit and then it's too much to carry on you? To me, these points conflict, and is evidence of Internet muscles. No, I'm not e-man.
Serpentor says
I bought a small amount of shares at $21-ish. That's my only stake in the company. So, I guess I did put my money where my mouth is.
Are you ever going to put your money where your mouth is? You offered $100k, yet you won't accept e-man's $10k bet. Care to explain...
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thomaswong.1986 says
Obviously you since you are on this thread and replying to it
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Tiny Tina,
Let it go. ;)
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No amount of baiting is going to make people take a bad deal.
The price point alone makes it unattractive. It's a coin toss where the "house" keeps 25%.. fuck dat .. I also don't brag about how much I made, but yes I did put my money where my mouth was and it was one of the easiest and few short term trades I've made in a long time.
Tina, I'm sorry you are losing money, you better dump that pig before the 1.4B shares flood the market. What ever possessed you to buy this POS? is this why you are interested in E-man's deal? you want someone to take a bad deal to make yourself feel better about your poor decision?
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tiny tina says
yes. I don't carry cash. Welcome to the modern world.
maybe thats why you are so enamored with FB. you think its some kind of fancy innovative new tech company. LOL
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Oh Tiny Tina...
Join us. Our jimmies remain steadfast against the rustling, for all eternity.
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^^ bmwman, I don't get the post above. Can you explain? Yeah, English is my 2nd language so I'm a little slow sometimes.
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E-man says
Ok. I was hoping someone would actually man up and bet you, but I guess I should have know with this bunch. It's amazing how many professional traders there are on this board who always buy at the bottom and sell at the top yet can't afford to move out of their parents' house. Oh well, good luck with your new house purchases e-man.
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BMWman:
English is my 0th language and I don't understand either...
particularly the flying lawnmower gorilla one...what in the hell is that about?
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E-man and swebb...
Do not allow the rustling meme to rustle your jimmies.
http://knowyourmeme.com/memes/that-really-rustled-my-jimmies
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tiny tina says
Who DOESN'T always buy low and sell high? Not making money on stocks is for poor people.
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bmwman91 says
Ahh, thanks for the translation. Does this mean I'm getting old and out of touch?
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swebb says
I could be wrong, but I think it just means you aren't a teenage girl.
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Already down to 18.058/sh
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Are people's jimmies rustled yet?
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My suspicion when the next lock-up period ends...
If I had to guess, 90% or more of the available shares for shorting will be shorted, the price will not tank as expected, causing the shorters to cover and drive the price up. Then people will unload, and the price will tank just late enough that the shorters won't capitalize on it and declare, "WTF, mate?!"
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Serpentor says
So how do you make the lawn-mower fly again? :)
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bmwman,
Based on the project growth, FB is worth around $14/share by this time next year. In a perfect world, the stock should be selling for $11.50/share now. Of course, we're not living in a perfect world. That's why it has been selling north of its value. For this reason, I'm not a buyer of FB.
On the other hand, ZNGA might be trading at $5 -$6/share this time next year based on its projected growth. I'm eyeing ZNGA now and debating on putting in a 2,000 share order for it at $2.66. Still eyeing. :)
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Facebook does in fact have substantial earnings right now. It is a very profitable mid-sized corporation. The only real mistake was in how the stock was valued at IPO. I do not see them going out of business or becoming completely unprofitable.
I will be the first to admit that talking trash is good fun though. The icing on the cake is having people vehemently defend the stock price and company while having no real personal affiliation, and openly succumbing to the butt hurt.
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bmwman91 says
However, the stock is over-valued. Just like AAPL has substantial earning power, but that doesn't justify the stock selling at $2,000/share now. FB will continue to tank if it doesn't increase its earnings and growth more than the projected 23% /year in the next 2-4 quarters.
bmwman91 says
Talking trash is all dandy and good, but you'd better back it up when someone called your bluff. I agree that FB has a good chance of tanking to $13, but I just disagree with the timing. That's it. At $18/share, the stock is still way too expensive compared to its earning power. Buying the stock at this price is a speculative bet. The stock is still in a downtrend and hasn't gone sideways yet.
ZNGA, on the other hand, has been going sideways for about a month now. However, it hasn't broken out of its downtrend yet. That's why I'm still waiting & debating on it.
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Come on man. People has ben talking shit about the housing market on this web site. I didnt see any rules about backing it up when the bulls called. I think we pretty much agree (except for Tina) the stock is going down for the rest of the year. Any predictions on specific numbers a specific time is pure speculation. Especially when a stock is owned by so many irrational kamakazi inverters like tina.
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E-Man, I have no argument with that position. Based on present earnings and what I consider likely/realistic growth, the stock price today is still too high. I have read a couple of editorial articles that say that Zuckerberg does not care about that since he still holds a very large majority of control over FB, and he is focused on the company's social mission rather than the business side. If that is the case, then the price definitely is too high right now, but investors should not be crying about it...it's sort of a "duh" thing if he has been openly stating this.
http://finance.yahoo.com/blogs/daily-ticker/becoming-clear-no-one-actually-read-facebook-ipo-160120121.html
In order to get in-line with the P/E ratio of the rest of NASDAQ, the FB stock price is looking at $5 per share (less when a large number of shares come on-market later this year). Will it actually go that low? I don't know, but for some reason I don't think so. I am sure that they are working on ways to cash in on mobile since that is where all of the users are going. I have no doubt that FB management is fully cognizant of this. If they are successful at that, their revenues will probably go up by a multiple or two. Time will tell though.
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Serpentor says
Bro, how can it NOT be a solid investment? I mean, even pets can have accounts! Purina pet chow ad revenue.....HELLOOOOOOO!
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Serpentor says
I see people are arguing over nothing. SFace & OO explained best why buyers are willing to pay through the nose to live in the fortress, and so far it has proven to be a decent bet because home prices in these area held up well. Patrick explained well why it's cheaper to rent in the fortress instead of buy. However, the timing of the purchase is critical. Had Patrick bought in the late 90's in Menlo Park, he would have been sitting pretty right now compared to renting. Going forward for the next 15 years, who knows whether this theory would hold up.
On the other hand, Iwog & Roberto are buying in the lower end where properties are generating positive cashflow. They are betting on inflation to reduce their debt burden overtime, and the tenants are increasing their networth by paying the debt of their mortgages. As of now, this is a better play than collecting 0.25% interest from the bank. Who knows if this is a good play or buying gold is a better play. None of us has a crystal ball so time will tell.
Both the bulls and the bears can be correct with their assessment. It depends on the timing and other moving parts that we have no control over.
To each his own.