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No. of Recommendations: 1
It's nice to see that FB is getting closer to intrinsic value.
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No. of Recommendations: 0
Any thoughts on buying ir selling?

Fb is 13% of my portfolio now (it was obviously more than that when I bought...)

What would you do with it at this reality now? Keep all? Sell a part of the stake?
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No. of Recommendations: 3
What would you do with it at this reality now? Keep all? Sell a part of the stake?

I don't see how Facebook can grow revenues at the pace it needs to grow them to make this company worth the risk, even at current prices. It is a behemoth in the social networking world, but they are unable to turn that into a growing profit stream. It is the poster child of dot com stocks, tons of traffic, mediocre revenue, and ridiculous valuations based on market share.

What is Facebook going to do to multiply their revenues by 10 in the next 2-3 years? That is what they need to do in order to justify their current price. If you don't have a good answer for that question, maybe you should consider selling.
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No. of Recommendations: 0
Fb is 13% of my portfolio now (it was obviously more than that when I bought...)
Even 10% is a large stake to take in any company.
Add to that, it was an IPO so there is no record of how the company has done in the past.

What would you do with it at this reality now? Keep all? Sell a part of the stake?

Once you sell, it makes the loss permanent.
What would I do?
What I did was to avoid the IPO, wait for more information. When the first 1/4 earning were released I read them as well as a lot of comments and opinions. When the stock plunged the day after, I bought about 0.1%-0.12% *of that paticular account*. Mostly being an oportunist and seeing such bad sentiment from the financial sector about a company that has a large enthusiastic following.
I'm up 5%. A loss will have a small effect on me. A gain is money in the bank, but I don't see FB being a long term stock like GE or Exxon.

So I cannot answer your question. Ben Franklin said he "paid too much for my whistle" . So enjoy the whistle or toss it away. Or see if it becomes a fine wine and improves with age.

jC
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No. of Recommendations: 3
Once you sell, it makes the loss permanent.

The only part where purchase price is important in the hold/ sell decision is when it comes to figuring out tax effects. "Making the loss permanent" might mean you realize a tax benefit. If you have a 'paper' loss because the company is undervalued then hold it. If it's a stinker or if there are better equities available then realizing the loss now is almost certainly better than holding onto it for a long time.

Hanging onto a stinker because you want to avoid making a loss permanent is a sure way to own a portfolio full of stinkers.
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No. of Recommendations: 0
I bought FB at $23. I like it. I am not going to pretend that I know how to value it.

Competition for FB is almost non existent, entry level barrier is very high and opportunities to monetize are many.

I believe Mark Zuckerberg himself does not know what the true value is or could be. However, odds are that it will be more valuable 10 years from now and even more valuable 20 years from now. This company will penetrate our social and economic fabric more and more as days go by, introduce richer value added features.
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No. of Recommendations: 4
we'll see how valuable the stock is later on this week when lockup period expires and insiders can sell shares...
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No. of Recommendations: 2
Competition for FB is almost non existent, entry level barrier is very high and opportunities to monetize are many.


I keep hearing this, but I see little evidence it is true. During the dot com boom people often assumed companies would eventually monetize their traffic and companies were bought and sold based on click count. It turns out that turning clicks into cash is *HARD* and very few companies have mastered it on a big scale.
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No. of Recommendations: 0
re: "competition for FB is almost non existent"...

didn't they say the same thing about MySpace about 5 years ago...
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No. of Recommendations: 1
didn't they say the same thing about MySpace about 5 years ago...

who said this ?

I have noticed that folks point to old failures of internet companies and extrapolate. Same arguments were given for Google when it was at $100, $200 etc. Ditto with Ebay and Amazon.

Facebook is here to stay. It is actually making money. Its penetration in the social fabric is undeniable. Monetizing abilities are many. Zuckerberg is young,smart and and owner. Guranteed success ? By no means. Good investment at $21. High probability.
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No. of Recommendations: 0
more people are actually ACTIVE users of Twitter right now than Facebook...

Twitter is averaging 340,000,000 tweets per day (1 Billion every 3 days)...

it has been estimated that their was 10 million tweets a day from the Olympic Village during the Olympics....

it's true that Facebook has over 700 million users but a lot are like me and only check in once a week...

Twitter is in a better position than Facebook in optimizing mobile and learned a valuable lesson in watching how Facebook screwed up their IPO...
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No. of Recommendations: 2
Yesterday my brokerage firm cancelled my May 18 opening day purchase and restored all the funds to my account as if I never owned it. I was one of those who placed a day limit order at 38.50 and received a "verified cancelled" notice at the end of the day. Only the following Monday did I find out that the trade actually went through and the shares were on my account. I fought it but the broker was covered by the fine print and it stayed in my account.

Until yesterday and the trade was "busted" and all is good.
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No. of Recommendations: 0
webline,

thats like betting on the favourite in the Kentucky Derby and he falls down during the race and breaks his leg and then the track refunds your money three months later...
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No. of Recommendations: 0
Yeah, I thought that was pretty cool. I wonder if it had anything to do with the bunch of cash I took out to buy a beemer recently. Maybe they thought I was getting ready to bail. They may have some refunds available from Nasdaq to use as needed.
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No. of Recommendations: 6
I have noticed that folks point to old failures of internet companies and extrapolate. Same arguments were given for Google when it was at $100, $200 etc. Ditto with Ebay and Amazon.

Looking at history and cherry picking the winners as examples is myopic.

Google's marketcap was 10B when they went public and they did it while still small and with a ton of growth ahead of them. Amazon and eBay had similarly small IPOs and were also in the early in their growth cycle. Facebook's market cap is huge... and there is a lot of evidence that suggest their growth has flattened.

Facebook went IPO MUCH later in it's life than any of those companies.

"Facebook is here to stay. It is actually making money. Its penetration in the social fabric is undeniable."

MySpace was a massive market leader with no competition, no-one would have guessed a social network with tens of millions of users would just fold in a six month period of time. They destroyed their user experience trying to monetize their product and users fled from the platform. There were other reasons, but the point is once MySpace 'jumped the shark', it went downhill fast.

"Monetizing abilities are many."

This is the mantra of Facebook investors, but how? As I said before, turning clicks into cash is HARD.

In the first year after they went IPO, Google had quarters where revenue was 4-6 times the previous year's same quarter revenue. They could do this because they were growing user count fast and increasing revenue per users incrementally. Google went public while the internet was still growing quickly and before they had saturated their market.

Given Facebook's recent performance, it certainly doesn't sound like they have cracked that nut and there is no evidence Facebook can post anything like that kind of growth. With 900 million users, their userbase in the is nearing saturation. It's impossible to multiply their userbase by 10 or 20 the way Google did because there simply aren't that many people in the world. Any 'explosive growth' is going to come from milking their revenue per user.

How can Facebook double revenue per user? How can they multiply it by six? If you want to compare Facebook to Google, eBay, and Amazon thats the sort of numbers they have to post.
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No. of Recommendations: 0
Given Facebook's recent performance, it certainly doesn't sound like they have cracked that nut and there is no evidence Facebook can post anything like that kind of growth. With 900 million users, their userbase in the is nearing saturation. It's impossible to multiply their userbase by 10 or 20 the way Google did because there simply aren't that many people in the world. Any 'explosive growth' is going to come from milking their revenue per user.

Reminds me of the short hey day of Digg and it's former CEO Kevin Rose. Remember how it was valuated at '60 Million'. It never went through IPO, of course, and it was recently sold for $500k - far less than I've seen companies like Apple pay for a small company with technology it wants (ex. PA Semi for 278 Million). Digg also soaked up $45 Million in investments, but could not monetize or maintain an upward trend in traffic.

Facebook isn't quite similar, but I do find serious problems with FB being able to monetize itself. Ads do not work well on social network sites. Integration with other companies and services (Apple's integration of FB into its new OS/iOS this fall) seems to be a gateway into cash flow that isn't exactly ad based. FB has had a LONG time pre-IPO to make the ad revenue work. It is making some revenue. Rapid growth on the pace of Google's IPO has yet to be realized by it's management team (or even a positive income stream).

Right now, I have a hard time believing FB is worth $10, let along $23-38.
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No. of Recommendations: 0
FB is making money from the Apple deal?
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No. of Recommendations: 0
Very few companies usually make REAL money from Apple Deals.

I'm certain a few developers, engineers and companies recently purchased BY Apple would disagree with you. Your statements of absolutes often take little reality into account.
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No. of Recommendations: 0
Looking at history and cherry picking the winners as examples is myopic. MySpace was a massive market leader with no competition </>

Facebook beat Myspace. Google beat Infoseek and Altavista etc. Microsoft beat Netscape. You will always have companies that fold.

Your inference that because Myspace folded quickly and that's why FB might is just not correct. IMHO Facebook is here to stay.

As I said before, turning clicks into cash is HARD.

Agree. FB has not demonstrated as yet. Amazon had not demonstrated for a long time as well.

FB is making money so it is a decent business with high margin possibilities. Will it ? I am saying Yes.

How ? Mobile, advertising, distrubution of movies, coupons , games - who knows. Ability to reach 1 Billion people instantaneously is unparalleled. How it will leverage this network effect is yet to be seen.
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No. of Recommendations: 1
who knows

That is precisely the problem.
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