Facebook IPO

[Syzygys]

Merging the 2 threads wasn't very smart decision. One is about a particular business practice (possible cheating) the other is a blog...

Anyhow today the stock dipped below $20 possibly because of this news:

http://www.bbc.com/news/technology-19093078

As I suspected, there are at least 83 millions fake (duplicate) users. Business wise I don't think FB really cares as long as the profiles are used and ads are clicked. What I would really care about is the inflated number of members. If one signs up and visits only 3-4 times a year, that is hardly a user. I would say at least once a week visits or more should be counted as active users... My guess that the number of active users (counted this way) is about 400 million (as opposed to 950 million)

[joepistole]

Merging the 2 threads wasn't very smart decision. One is about a particular business practice (possible cheating) the other is a blog...

Anyhow today the stock dipped below $20 possibly because of this news:

http://www.bbc.com/news/technology-19093078

As I suspected, there are at least 83 millions fake (duplicate) users. Business wise I don't think FB really cares as long as the profiles are used and ads are clicked. What I would really care about is the inflated number of members. If one signs up and visits only 3-4 times a year, that is hardly a user. I would say at least once a week visits or more should be counted as active users... My guess that the number of active users (counted this way) is about 400 million (as opposed to 950 million)

You hit on some good points. I think the numbers are greatly inflated on many levels. I think there is too much hype and not enough reality here. And more importantly, I don't see Facebook as being very user friendly. They appear to me to be more worried about the managing the numbers than they are about managing the product and delivering user value and that is a reciepe for trouble in my book.

[Billy T]

Merging the 2 threads wasn't very smart decision. ...

Well that was my judgement call as I like to keep as many different threads on the first B&E page as possible and encourage posters to use one related to their material, if possible. Not make them go to page 2 looking for one they can use. I follow this policy too - you will note there has only been one sticky thread since I became B&E moderator - to keep open page 1 space for others. I think I am only mod that has always had only one sticky thread.

Everything in this merged thread should and can relate to some aspect of Facebook. There have been many, your two, plus the failure to disclose known facts during the "roadshow" promotion of the IPO; facts related to claims (and law suit) of the two rich (brothers, I think) that Zuckerberg both took their money and stole their idea; related to repayment by some of the brokerages firms who profited and also knew undisclosed facts may need to repay or buy back the shares they sold; etc. - much too many for each to have its own thread.

I am quite light handed with my moderation of B&E, tolerating long detours, mild name calling, etc. but tight fisted about keeping as many different threads on page 1 as I can and asking posters to use an existing one when reasonable instead of starting a new one. That way, when a thread falls to page two, it normally is because the subject no longer is interesting to most B&E visitors.

As I suspected, there are at least 83 millions fake (duplicate) users. Business wise I don't think FB really cares as long as the profiles are used and ads are clicked. What I would really care about is the inflated number of members. If one signs up and visits only 3-4 times a year, that is hardly a user. I would say at least once a week visits or more should be counted as active users... My guess that the number of active users (counted this way) is about 400 million (as opposed to 950 million)

That is right on thread. So is this:
"... The 91-day lock up period imposed on employees and company insiders following Facebook's IPO expires later this month. That means another 268 million shares could come up for sale further depressing the value of the 2.1 million shares already outstanding. ..." from: http://moneymorning.com/2012/08/07/s...-7-50-a-share/

[Syzygys]

Well that was my judgement call

We all male mistakes...

Based on the P/E ratio and expert said before the IPO the stock should be in the $16-24 price range, and this is where it is now...

[Billy T]

"... Facebook has confirmed that four high-ranking managers are moving on from the company, news that will fuel speculation that the social networking giant may suffer a talent drain in the wake of its IPO. ..." From: http://www.computerworld.com/s/artic..._pm_2012-08-09

[Syzygys]

More people from the Zuckerberg family work for Google than for FB... Just a slightly irrelevant info, although ironic...

[Syzygys]

Hitting new lows of $19 today, after the first batch of new shares from insiders are released to trading. There will be 4 more batches coming out by next May, diluting the available shares....

[Billy T]

We all male mistakes...

I´m wondering if you still think one FB thread instead of many was a mistake because to keep them narrowly defined on separate small aspects as you wanted would mean we would have about a dozen different FB related threads by now. Your posts 37 & 46 & my post 45 would not fit in either of the two separate ones you started. (Perhaps other posts also would need their separate threads - I only went back to post 37 looking for posts that would have been off narrowly defined threads.)

If we had many different narrowly defined FB related threads, one would be: "FB´s insider shares lock up effects." Only your post 47 & my post 45 would be there.

[Syzygys]

Beside me, nobody talks here about stocks, and I promise I won't start another on FB...

But to answer your question, I don't really care anymore...

[Billy T]

Beside me, nobody talks here about stocks, ...

There were (still are I think) two old investment threads in B&E, called something like "What is your favorite investment (no stocks)" & "What is your favorite stock?" They fell into dis use and off the main B&E page. You might like to finds and rescue one or both. - Might be interesting to see who made good recommendations (and who did not).

[Billy T]

FB fell to new low at close today on very high volume: $18.058/sh a drop of 5.40%

[Crunchy Cat]

...My prediction is that because the stock is way overvalued, it will be under $20 in 2 years or less...

Accurate.

[joepistole]

At some point the numbers have to work, and I as I have written before, I don’t see the numbers working for Facebook until the stock price hits $9-$10 per share – caeteris paribus. I think anyone who goes long on this stock above $9-$10 per share is looking to be the greater fool.

[Syzygys]

Broke under $18, at 17.65 currently. An article blaming the high IPO price on this guy:

http://dealbook.nytimes.com/2012/09...?ref=technology

[Michael]

Facebook private message rumour is 'false', site says

Separately, Facebook shares fell up to 11% after an influential journal said the stock is worth just $15.

Is this a small Freudian slip on the authors' part?

[Michael]

Facebook looks to be back up on top of things.

Any comments?

[Syzygys]

FB actually makes money and a lot of it. because of that, a bounce was in the cards. The strange thing was that the bounce started when a bunch of restricted stocks became available. FB is here to stay, the question is, in what range it will linger....

Even GRPN bounced 30% in a week or so when a big fund announced that they own 10% of the stock....

[youreyes]

FB actually makes money and a lot of it. because of that, a bounce was in the cards. The strange thing was that the bounce started when a bunch of restricted stocks became available. FB is here to stay, the question is, in what range it will linger....

Even GRPN bounced 30% in a week or so when a big fund announced that they own 10% of the stock....

Quoting myself back than when Facebook shares looked bleak...

The company stocks will go up, once enough time will pass from the IPO impact. Businesses will grow and demand for social media control will as well. If there is a best time to buy Facebook stocks, it is now.

Dated quote on 07-31-12. Beginning of August of 2012.



a 41.7% stock increase! Has anyone listened? doubt it...

[Syzygys]

Dated quote on 07-31-12. Beginning of August of 2012.
a 41.7% stock increase! Has anyone listened? doubt it...[/SIZE][/COLOR]

On 7/31 FB was at $22, so although not a bad call, buying it below $20 was a much better deal...

The bottom line is: nothing goes down in a straight line, there will be dead cat bounces along the way. Again, FB unlike GRPN is making money, so although it might be overpriced, but there are fundamentals behind the price.