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Dreadnought
Posts: 10201
Joined: Tue Feb 19, 2008 6:31 pm

RE: Who's Buying Facebook Stock?

Thu May 24, 2012 12:41 am

Quoting Silver1SWA (Reply 48):
When Google+ launched, they had a lot of potential and a lot of Facebook users eager to try it out. Google+ had a chance, but failed. People gave it a try and didn't like it but the important thing is people were willing to see what it was all about. If something comes along that people are willing to try and they get hooked, goodbye Facebook.


Very good point. There is only one direction you can go when you are Number 1 - and that's not up.

On the other hand, Google got into the very volatile and flighty search engine wars some 10 years ago, and has remained on top ever since.
Democrats haven't been this angry since we took away their slaves.
 
wukka
Posts: 884
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RE: Who's Buying Facebook Stock?

Thu May 24, 2012 7:56 am

Quoting Klaus (Reply 39):
No, it's actually trending the other way already, since more and more people are more and more shifting their internet use to mobile devices where advertising gets so intrusive on the relatively small displays that it is much harder to place ads without annoying your users to the point of abandoning the base service entirely.

Facebook will tend to lose ad revenue because of the trend to mobile use, and the only thing I'm shocked about is that some analysts and investors have only woken up to this fact after the IPO.

The FB stock will eventually find its home in the low single digits like many others before it; They simply have too little revenue and profit potential to justify the current massive overvaluation.

Klaus, I don't think that I have ever agreed with you on anything ever in the history of ourselves being ourselves on Airliners.net, until now. (Apple fanboy. :P)

In this case, I am 100% with you. Facebook is probably worth a couple of bucks. Not enough to relegate it to penny stock at the moment, but soon enough. Hell, I saw US Robotics damn near create the Internet with dial-up banks using Hayes (now defunct) AT commands become absolutely nothing in a matter of a couple of years.

Facebook is NOT a game changer. It will never be valued as such. It is a search engine for people that you wouldn't otherwise look for unless you want them to harvest your virtual farm while you go out with your friends.
We can agree to disagree.
 
Klaus
Posts: 21599
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RE: Who's Buying Facebook Stock?

Thu May 24, 2012 9:51 pm

Quoting wukka (Reply 51):
Klaus, I don't think that I have ever agreed with you on anything ever in the history of ourselves being ourselves on Airliners.net, until now.

We should be careful about upsetting the balance of the universe that way.

Never cross the beams! 
 
windy95
Posts: 2782
Joined: Thu Dec 18, 2008 1:11 pm

RE: Who's Buying Facebook Stock?

Fri May 25, 2012 11:55 am

Quoting Klaus (Reply 39):
Quoting moo (Reply 29):Advertising already pays off, in the future it will pay off at a greater rate for Facebook because they will be able to target much better than Google.
No, it's actually trending the other way already, since more and more people are more and more shifting their internet use to mobile devices where advertising gets so intrusive on the relatively small displays that it is much harder to place ads without annoying your users to the point of abandoning the base service entirely.

Agree with you on this. This is point number one on why not to buy this stock. Most everyone that i know use FB on the Iphone. Apple would be a better buy the FB.

Quoting moo (Reply 46):
As far as I have seen, they've gone up in most areas.

Not in the phone app areas. It generates less revenue than the computer ads.

Quoting moo (Reply 46):
Migrating to a mobile device brings a higher yield ad focus in - desktop users can block ads, mobile device users cannot (especially if the ad is embedded in the app - ad blockers dont get the chance)

If i cannot block the floating ad then I will no longer use the app. I use the iphone fro quick info and for my aging eyes it is hard enough to read. Toss these ads in makes it even harder. They will never generate the same ad revenue with phone apps that they do with the PC.

Quoting Dreadnought (Reply 47):
A P/E ratio of 70 is justified if you have a business plan where you can realistically grow your revenues and earnings by 100% per year for several years, and I just don't see that happening - how can you grow that fast when you are already so big?I haven't seen the financial projections they broadcast prior to the IPO, but it sounds like they were wildly optimistic.

I believe the P/E ratio called for 100% growth for 5 to 6 years.

Quoting Klaus (Reply 52):
Quoting wukka (Reply 51):Klaus, I don't think that I have ever agreed with you on anything ever in the history of ourselves being ourselves on Airliners.net, until now.We should be careful about upsetting the balance of the universe that way.Never cross the beams!

Afraid I will have to join this party. Klaus is spot on with his points.   
 
windy95
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RE: Who's Buying Facebook Stock?

Fri May 25, 2012 7:41 pm

Just watched anotherr analyst say that FB will grind down to $22. Everyone is looking at the P/E ratio as totally unrealistic.
 
TheCommodore
Posts: 3458
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RE: Who's Buying Facebook Stock?

Wed May 30, 2012 6:29 am

Quoting zrs70 (Thread starter):
Looks like it will start at $38/ share. Who is getting in?

Plenty appear to be getting out !

And things are going from bad to worse for Mr Zuckerburg.

Share price drops a whacking 36% since its US$45 highs....

Glad I didn't buy any.  http://www.smh.com.au/business/world...worlds-richest-20120530-1zj2w.html
“At first, they'll only dislike what you say, but the more correct you start sounding the more they'll dislike you.”
 
na
Posts: 9778
Joined: Sun Dec 12, 1999 3:52 am

RE: Who's Buying Facebook Stock?

Wed May 30, 2012 12:48 pm

Facebook is a bubble. Much of the business is virtual. 900 million users, well, many of them could walk away in a few years if some other geek has a better idea than Zuckerberg. Totally overrated, overhyped. Those who couldnt smell it from a mile are now burning the money they made before with more clever stuff.
 
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flyingturtle
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RE: Who's Buying Facebook Stock?

Wed May 30, 2012 1:32 pm

And the real winners are those who have short positions.
Reading accident reports is what calms me down
 
na
Posts: 9778
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RE: Who's Buying Facebook Stock?

Wed May 30, 2012 2:15 pm

Quoting windy95 (Reply 48):
Just watched anotherr analyst say that FB will grind down to $22.

I´d even expect less midterm.
 
FlyPNS1
Posts: 5507
Joined: Wed Dec 01, 1999 7:12 am

RE: Who's Buying Facebook Stock?

Wed May 30, 2012 5:04 pm

Quoting moo (Reply 44):
The trend to mobile use does nothing negative to advertising at all.
Quoting moo (Reply 46):
Migrating to a mobile device brings a higher yield ad focus in - desktop users can block ads, mobile device users cannot (especially if the ad is embedded in the app - ad blockers dont get the chance) - and the ad can be location targeted as well as demographic targeted.

Facebook isn't so sure. Here's an excerpt from part of FB's amended IPO filing on May 9th.

"However, we do not currently directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven.

We believe this increased usage of Facebook on mobile devices has contributed to the recent trend of our daily active users (DAUs) increasing more rapidly than the increase in the number of ads delivered.

If users increasingly access Facebook mobile products as a substitute for access through personal computers, and if we are unable to successfully implement monetization strategies for our mobile users, or if we incur excessive expenses in this effort, our financial performance and ability to grow revenue would be negatively affected."


Here's my thing. If Facebook is such a great product, they should have no problem charging people a minimal access fee. Let's say FB has 900 million users, if you charged them $1/month, you'd generated over $10 Billion in annual revenues. Even if only 600 million users were willing to pay, you'd still get over $7Billion in annual revenues. And really, you could probably go as high as $5/month without scaring away too many users.

If people aren't willing to pay even $1/month, then maybe FB isn't quite as popular as it claims to be.
 
virgin744
Posts: 825
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RE: Who's Buying Facebook Stock?

Thu May 31, 2012 12:29 am

Quoting FlyPNS1 (Reply 53):
Here's my thing. If Facebook is such a great product, they should have no problem charging people a minimal access fee. Let's say FB has 900 million users, if you charged them $1/month, you'd generated over $10 Billion in annual revenues. Even if only 600 million users were willing to pay, you'd still get over $7Billion in annual revenues. And really, you could probably go as high as $5/month without scaring away too many users.

If people aren't willing to pay even $1/month, then maybe FB isn't quite as popular as it claims to be.

FB is only as popular as it is because its a free product (that does a good job). Once you start charging people to use it you will see a huge drastic drop in the number of users of it.. Think of all those bored housewives and single people that arent earning a magnificent salary...The moment FB attempts to charge them to use it, they'll leave FB in a heartbeat and join the next free social netwoking community site thats nearly as good. Thats just the way the internet is.

I can easily see this share price hitting the 10's. The only hope they have is buying Blackberry and attempting to crack the mobile platform by building advertising into it but thats where their biggest problem is, they are trying to push data that will absolutely never be allowed by the consumer - advertising on their mobile phones. That's the 1 thing that will never ever work - unless mobile phone services become free and then the amount of data (advertising junk) being pushed to the devices arent being charged to the end user. Until that happens they can kiss their dreams of trying to receive facebook income on the mobile platform goodbye.

I dont know what their long term business plan is but I just honestly dont see what FB has to offer to other than connnecting people and allowing people to share data with the rest of the world. If they decided to offer tangible services then I could get it but they arent into that yet. Call me a cynic but I think this has got to be one of the most overrated/inflated, useless, knee-jerk, media-darling driven IPOs ever.
 
WestJet747
Posts: 1950
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RE: Who's Buying Facebook Stock?

Thu May 31, 2012 1:00 am

Quoting na (Reply 50):
900 million users
Quoting FlyPNS1 (Reply 53):
900 million users

More like 900 million accounts. The media continues to say that Facebook is approaching 900 million users, when in fact, that number is for individual accounts, including business pages, duplicates and abandoned accounts. I suspect the real number of unique, active users is a significantly lower.

Quoting FlyPNS1 (Reply 53):
if you charged them $1/month, you'd generated over $10 Billion in annual revenues

No, they'd generate $1 billion, because 90% of their customer base would hit the road if anyone tried to charge them for a service they've received for free over the past 5 years.

Quoting FlyPNS1 (Reply 53):
If people aren't willing to pay even $1/month, then maybe FB isn't quite as popular as it claims to be.

Remember that Facebook had it's start as a social network for students, the most frugal of market segments. A good chunk of what made Facebook explode was that you didn't have to drop a penny to use it.

Quoting virgin744 (Reply 54):
The only hope they have is buying Blackberry

Sorry to nitpick, but the company's name is Research In Motion. BlackBerry is the name of the product line.  
Flying refined.
 
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moo
Posts: 5003
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RE: Who's Buying Facebook Stock?

Thu May 31, 2012 10:59 am

Quoting FlyPNS1 (Reply 59):

That doesn't conflict with my statement - its simply a case of Facebook doesn't explicitly target their mobile audience with ads at all right now, so of course they are seeing a drop in yields as more people use mobile devices!

Where you do target that audience, I have personally seen an upward trend in yield over the standard web, whether thats using a mobile version of the website or an app.
 
Stealthz
Posts: 5558
Joined: Wed Feb 02, 2005 11:43 am

RE: Who's Buying Facebook Stock?

Thu May 31, 2012 1:58 pm

Quoting zrs70 (Reply 6):
Well, I got in at 38.04.
Quoting WestJet747 (Reply 7):
but it looks like you got it on the cheaper end so well done!

27.94... Thurs 31 may ?? Maybe not so cheap?... oops now 27.71 while I write this post.. Stellar performer
If your camera sends text messages, that could explain why your photos are rubbish!....well that might have changed!!!
 
EricR
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RE: Who's Buying Facebook Stock?

Mon Jun 04, 2012 1:34 am

A company valued at $100 billion with only $700 million in revenues is the definition of overvalued and was a big red flag from day one. In theory, FB should have gone public several years ago at a much lower valuation and allow market demand to push the market cap higher. However, the fact that they didn't also raises another red flag.

I think FB and Wall Street purposely kept the company private and allowed public hype artificially drive the market cap higher. I think they did this because they knew if they had gone public a couple years earlier, the market cap would never have reached $100B. The revenue and growth would never have supported a market cap of $100B.

Once the company went public at this artificially inflated market cap, all of the main investors pulled their money out, thus resulting in the FB implosion.

It was a clever strategy, though it severely hurt those who were gullible enough to fall for the hype. The problem now is that the stock will over-correct (go below fair value), before it rebounds. It will take time to change the perception that the stock is overvalued.

As far as the mobile advertisement issue, that is not an insurmountable obstacle. This can be easily addressed. But I think the stock will still be overvalued even after this issue is fixed.
 
StarAC17
Posts: 3871
Joined: Thu Aug 07, 2003 11:54 am

RE: Who's Buying Facebook Stock?

Mon Jun 04, 2012 6:43 am

Quoting FlyPNS1 (Reply 53):
Here's my thing. If Facebook is such a great product, they should have no problem charging people a minimal access fee. Let's say FB has 900 million users, if you charged them $1/month, you'd generated over $10 Billion in annual revenues. Even if only 600 million users were willing to pay, you'd still get over $7Billion in annual revenues. And really, you could probably go as high as $5/month without scaring away too many users.

They charge me 1 cent a month and I'm walking, Zuckerberg knows this and knows if there is ever a fee for it, its not happening. Also any investor pushing it I wouldn't take much advice from because clearly they don't understand the Internet. A single fee might work if it was say $10-$20 like A.nets basic membership but even that will deter a lot of users.

FB is a good thing don't get me wrong but its only going to work if its free. I don't know if they have any patents on any of the interface and even so what they have is easily replaceable.

[Edited 2012-06-03 23:46:23]
Engineers Rule The World!!!!!
 
EricR
Posts: 1226
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RE: Who's Buying Facebook Stock?

Mon Jun 04, 2012 5:52 pm

Well, according to one analyst, he believes Facebook will disappear in 5 to 7 years. By disappear he means Facebook will become insignificant similar to how Yahoo is today because they may not be able to adapt and move from a virtually free product to one that charges users & creates meaningful revenue.

I tend to believe his viewpoint. Facebook does not seem to be able to find a way to generate significant revenue to warrant the large market cap. Meanwhile, upstarts are probably building a mobile type product similar to Facebook where they can turn the Facebook "concept" into a better business model.

Facebook is a significant force in social media, but their business model does not translate well for a publically traded company that must illustrate its ability to generate large and growing revenue streams.

Below is the link to the full article.

http://www.cnbc.com/id/47674474

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