Facebook Ipo

[samsiam]

good luck to the wise 'investors'.......

Edited May 23, 2012 by samsiam

[midas]

good luck to the wise 'investors'.......

or should it be good luck to the even wiser lawyers ..... because they

will end up making more money than the investors .....

Investors sue Facebook and banks on IPO

Recriminations over Facebook’s initial public offering have escalated with a group of investors filing a lawsuit against the social network group and the investment banks that backed last week’s initial public offering.

In a US federal district court on Wednesday, a group of Facebook investors alleged the company and the five banks – JPMorgan Chase, Morgan Stanley, Goldman Sachs, Bank of America and Barclays – “selectively disclosed” revisions to Facebook’s earnings outlook to “certain preferred investors”.

http://www.ft.com/in...l#axzz1vlTAEnJ9

Edited May 24, 2012 by midas

[samsiam]

I feel cheated now when I go to my facebook page....I cannot stand the sight of it

[Asiantravel]

I feel cheated now when I go to my facebook page....I cannot stand the sight of it

so it is safe to say you are one of those who is very unlikely to agree to pay for content

[SoloFlyer]

how do you un-like yourself?

[yoshiwara]

I think it will raise to 80-95usd after opening, and stay there for most of the day, but a bumpy ride. Guess it will close around 80usd.

Well you got that one spot on. Well done.

[bendix]

You simply dont understand the IPO process, Asiatravel

It could be argued they got it very right for their client - in this case Facebook. Facebook sold all those shares for 38 bucks; that is money in their bank account. That the price is now lower doesnt worry them; they raised the cash they wanted.

Had the banks advised to have a lower share issue price, their client would have left hundreds of millions of dollars on the table.

You could argue that banks do their job properly when the post-IPO price falls, and have failed in their job when the share price soars after issue.

Bendix I note your admirable attempt to defend the “ reputation “ of bankers involved in IPOs but

unfortunately for them “a series of accounting failures, fraud and other corporate scandals “

as discussed in this recent New York Times article seems to illustrate quite well the bankers attitude towards ethical behavior

Hong Kong Securities Regulator Seeks Penalties for I.P.O. Fraud

http://query.nytimes...63&ref=hongkong

Again, you simply don't know what you're talking about.

For the record, I know the gentleman in the artcile - the CEO of the HK SFC. In fact, when he was in his previous role before joining SFC he hired me into my current job.

These proposals are nothing to do with fraud on the part of Investment Banks on IPOs. Instead they are an attempt to encourage banks to assume liability for the material that is included in IPO prospectuses, information that is provided to the investment banks by the mainland companies wanting to issue on the HK exchange and which is audited by Chinese offices of global and local accounting firms.

Up to now, the investment banks have acted in good faith that the financial material provided to them by companies and their auditors is accurate; that is what audited accounts are for. That is the role of the auditor.

By putting more liability on the investment banks, Mr Alder and the HK SFC are implicitly criticising the mainland auditors and encouraging the investment banks to do more due diligence themselves. The intention is that the investment banks will use their leverage to increase the quality of financial reporting in mainland companies.

[yoshiwara]

once again the little guys get shafted

Not so fast Batman. If you are an investor in this stock then you will think that it is a good purchase at $38, $32, $42 upwards to what you think is the potential value. Even the last minute decline in current/projected ad revenues will not have shaken you too much from your assessment of the stock's potential, which is after all what you are buying. Who got shafted? Not this person. The ones who got shafted were those who thought they were on a one-way bet (like George?) who thought they could flip for some quick money. These are probably the same little Johnnies who like to wail at the banks for making big profits. They got caught out.

[Asiantravel]

You simply dont understand the IPO process, Asiatravel

It could be argued they got it very right for their client - in this case Facebook. Facebook sold all those shares for 38 bucks; that is money in their bank account. That the price is now lower doesnt worry them; they raised the cash they wanted.

Had the banks advised to have a lower share issue price, their client would have left hundreds of millions of dollars on the table.

You could argue that banks do their job properly when the post-IPO price falls, and have failed in their job when the share price soars after issue.

Bendix I note your admirable attempt to defend the “ reputation “ of bankers involved in IPOs but

unfortunately for them “a series of accounting failures, fraud and other corporate scandals “

as discussed in this recent New York Times article seems to illustrate quite well the bankers attitude towards ethical behavior

Hong Kong Securities Regulator Seeks Penalties for I.P.O. Fraud

http://query.nytimes...63&ref=hongkong

Again, you simply don't know what you're talking about.

For the record, I know the gentleman in the artcile - the CEO of the HK SFC. In fact, when he was in his previous role before joining SFC he hired me into my current job.

These proposals are nothing to do with fraud on the part of Investment Banks on IPOs. Instead they are an attempt to encourage banks to assume liability for the material that is included in IPO prospectuses, information that is provided to the investment banks by the mainland companies wanting to issue on the HK exchange and which is audited by Chinese offices of global and local accounting firms.

Up to now, the investment banks have acted in good faith that the financial material provided to them by companies and their auditors is accurate; that is what audited accounts are for. That is the role of the auditor.

By putting more liability on the investment banks, Mr Alder and the HK SFC are implicitly criticising the mainland auditors and encouraging the investment banks to do more due diligence themselves. The intention is that the investment banks will use their leverage to increase the quality of financial reporting in mainland companies.

of more relevance to show the real nature of these bankers is they are accused of

concealing "a severe and pronounced reduction" in revenue growth forecasts regarding Facebook.

let us see what transpires in the court cases but as far as I'm concerned they are

no better than used car salesman

Edited May 25, 2012 by Asiantravel

[midas]

Facebook’s stock should trade for $13.80

http://www.marketwatch.com/story/facebooks-stock-should-trade-for-1380-2012-05-25?link=MW_popular

[midas]

" Dear Facebook User,

Hi, it’s Mark.

As you may have heard, our IPO last week didn’t go quite as well as expected. How badly did it go, exactly? If you live in a major city, you’ve probably seen homeless guys huddled around bonfires of Facebook stock. More ominously, I just received a call from my attorney telling me that I probably didn’t need a prenup after all.

If you’re a Facebook investor, you already know what this means: it sucks to be you. But what if you’re one of the billion Facebook users in the world? Well, it also sucks to be you, because I am writing to you now to ask for your financial support to help save Facebook.

It’s only fair. Since its founding in 2004, Facebook has totally revolutionized the way you waste your life. Without it, you would find yourself in the unpleasant and awkward position of having to speak to your family. And so, to keep Facebook alive, I am instituting the following new usage charges:

– $1 per poke

– $5 for every ex you crop out of a profile picture

– $10 for every time you stalk someone from high school, college, or job you were fired from because of that HR “incident”

– $15 for every “friend” you have never met (no charge for friends you know, if any)

– $20 for every sheep, bird, or the Scrabble letters Z, X or Q

With your financial help, Facebook should be around for many years to come, providing you with hours upon hours of pointless and isolating activity. Without your help? I’ve just got one word for you: Friendster.

Help me,

Mark "

http://www.borowitzreport.com/2012/05/25/a-message-about-facebook/

[bendix]

You simply dont understand the IPO process, Asiatravel

It could be argued they got it very right for their client - in this case Facebook. Facebook sold all those shares for 38 bucks; that is money in their bank account. That the price is now lower doesnt worry them; they raised the cash they wanted.

Had the banks advised to have a lower share issue price, their client would have left hundreds of millions of dollars on the table.

You could argue that banks do their job properly when the post-IPO price falls, and have failed in their job when the share price soars after issue.

Bendix I note your admirable attempt to defend the “ reputation “ of bankers involved in IPOs but

unfortunately for them “a series of accounting failures, fraud and other corporate scandals “

as discussed in this recent New York Times article seems to illustrate quite well the bankers attitude towards ethical behavior

Hong Kong Securities Regulator Seeks Penalties for I.P.O. Fraud

http://query.nytimes...63&ref=hongkong

Again, you simply don't know what you're talking about.

For the record, I know the gentleman in the artcile - the CEO of the HK SFC. In fact, when he was in his previous role before joining SFC he hired me into my current job.

These proposals are nothing to do with fraud on the part of Investment Banks on IPOs. Instead they are an attempt to encourage banks to assume liability for the material that is included in IPO prospectuses, information that is provided to the investment banks by the mainland companies wanting to issue on the HK exchange and which is audited by Chinese offices of global and local accounting firms.

Up to now, the investment banks have acted in good faith that the financial material provided to them by companies and their auditors is accurate; that is what audited accounts are for. That is the role of the auditor.

By putting more liability on the investment banks, Mr Alder and the HK SFC are implicitly criticising the mainland auditors and encouraging the investment banks to do more due diligence themselves. The intention is that the investment banks will use their leverage to increase the quality of financial reporting in mainland companies.

of more relevance to show the real nature of these bankers is they are accused of

concealing "a severe and pronounced reduction" in revenue growth forecasts regarding Facebook.

let us see what transpires in the court cases but as far as I'm concerned they are

no better than used car salesman

Simply not true. These concerns were highlighted in the prospectus and discussed at length in the financial media before the IPO.

It is well-known - and has been for sometime - that one of the biggest challenges facing Facebook has been that it has failed to properly monetise its business model. Market commentators have regularly discussed the fact that while members have grown exponentially, revenue growth has not kept pace.

The banks were cheeky to ask 38 bucks for a share, but at the end of the day they are paid by Facebook. Those shares were fully subscribed at 38 bucks a share and all were sold to investors too caught up in the hype to do proper due diligence or ask themselves why a company with 900 million members couldnt turn that into substantional profits.

Caveat emptor.

[Asiantravel]

Bendix I note your admirable attempt to defend the “ reputation “ of bankers involved in IPOs but

unfortunately for them “a series of accounting failures, fraud and other corporate scandals “

as discussed in this recent New York Times article seems to illustrate quite well the bankers attitude towards ethical behavior

Hong Kong Securities Regulator Seeks Penalties for I.P.O. Fraud

http://query.nytimes...63&ref=hongkong

Again, you simply don't know what you're talking about.

For the record, I know the gentleman in the artcile - the CEO of the HK SFC. In fact, when he was in his previous role before joining SFC he hired me into my current job.

These proposals are nothing to do with fraud on the part of Investment Banks on IPOs. Instead they are an attempt to encourage banks to assume liability for the material that is included in IPO prospectuses, information that is provided to the investment banks by the mainland companies wanting to issue on the HK exchange and which is audited by Chinese offices of global and local accounting firms.

Up to now, the investment banks have acted in good faith that the financial material provided to them by companies and their auditors is accurate; that is what audited accounts are for. That is the role of the auditor.

By putting more liability on the investment banks, Mr Alder and the HK SFC are implicitly criticising the mainland auditors and encouraging the investment banks to do more due diligence themselves. The intention is that the investment banks will use their leverage to increase the quality of financial reporting in mainland companies.

of more relevance to show the real nature of these bankers is they are accused of

concealing "a severe and pronounced reduction" in revenue growth forecasts regarding Facebook.

let us see what transpires in the court cases but as far as I'm concerned they are

no better than used car salesman

Simply not true. These concerns were highlighted in the prospectus and discussed at length in the financial media before the IPO.

It is well-known - and has been for sometime - that one of the biggest challenges facing Facebook has been that it has failed to properly monetise its business model. Market commentators have regularly discussed the fact that while members have grown exponentially, revenue growth has not kept pace.

The banks were cheeky to ask 38 bucks for a share, but at the end of the day they are paid by Facebook. Those shares were fully subscribed at 38 bucks a share and all were sold to investors too caught up in the hype to do proper due diligence or ask themselves why a company with 900 million members couldnt turn that into substantional profits.

Caveat emptor.

" Caveat emptor. " yes indeed - this should should apply to ANYTHING regarding banks

or maybe it should just be beware of banks full stop

did you work on this particular IPO personally? if not you know no more about it than I do -it's a simple as that

and after watching an analysis of this during a discussion on Al Jazeera this morning

I disagree completely with your assessment and I prefer to wait for the outcome of the court cases

and maybe even Congressional hearings

http://www.reuters.c...E8GN7SL20120523

Edited May 26, 2012 by Asiantravel

[bendix]

Nope. I had nothing to do with it. I'm not a banker.

I do watch financial markets carefully though and anyone with an ounce of common sense could see that this was going to happen. For heaven's sake, the underwriters even issued an AMENDED prospectus which expressly referred to the disparity between member growth and revenue growth: an amended prospectus? That's highly unusual and should have been seen as a cautionary sign. This was discussed at length on CNBC.

Short of telling investors to avoid it at those prices, I'm not sure what more the bankers could have done.

But, frankly, you can't protect some people from themselves. They saw the pop of other recent online IPOs and saw the sexiness of Facebook and just had to get in on it themselves, ignoring all the facts and analysis.

[yoshiwara]

But, frankly, you can't protect some people from themselves. They saw the pop of other recent online IPOs and saw the sexiness of Facebook and just had to get in on it themselves, ignoring all the facts and analysis.

They were reading all the Georges of the world and on those predictions they couldn't lose.

[ExpatJ]

Facebook down another 5% in today's trading so far.

[midas]

The largest option trades bet on Facebook seeing more downside this summer, pegging a $25 share price by mid-July.

http://online.wsj.com/article/BT-CO-20120529-713253.html

[yoshiwara]

Prior to the IPO there was extensive discussion on CNBC of the FB income stream. FB supporters said that there were so many FB users that if only 10% of users accessed the ads, there would be a boom. So the sale was on a promise of potential and shareholders were in practice buying eyeballs. That was a warning. The blaming of Morgan Stanley is a sideshow on what has happened to the price. Yesterday options opened up on FB and the price has dropped to below 29. For those who are in for the long haul, the possible purchase of Opera would be very good news. It is an excellent search engine.

[bendix]

The fall in price - particularly when the options started to be trade - is further evidence that people bought the share simply to onsell immediately.

Let's be honest here. This is a poor revenue company. 900 million users created only 1bn profit last year . . just over a dollar a customer. Jeez, a bangkok street noodle seller generates more profit per customer than that.

[ExpatJ]

Any one willing to admit they bought FB shares? Would be interested to hear your buy time/price.

[MrRealDeal]

If your going to invest in any company with a 100 times revenue valuation you better be in it for the long haul or you are in it under the theory that you can flip it to the next guy , it would seem as though enough people were in to flip it and dumped it when it turned out the flipping option didn't work out. No offence to anyone who was wrong .... but thinking that it would go from 100 times valuation to 200 times valuation on the first day or week was a pie in the sky speculative bet.

Whats odd but true is that of they had no revenue at all it probabbly would have gone up just like so many other 0 revenue speculative stocks , but they all come back to earth eventually.

The reality is that advertising in any form is not worth 100 times reveune so if you own it you need to be a believer that some other form of revenue will come along like with google.

FB has begun to try and charge for posts in new zealand and of course failed miserably and would go the way of netflix if they try, it's only ego that would make Mark believe people will pay to post or pay to stay.

What Mark really wants to do is compete with Cable TV , to offer everything you get on cable for the same price and you get facebook for free , he is not alone is this venture although no one has convienced major cable to partner they are all trying Apple, Google , FB all want to be able to offer us TV through the web, and they will probabbly all get it done eventually, the problem from an investment standpoint is that FB at 100 times earnings accomplishing that verses Apple at 19 times doing the same thing means FB would still be overvalued.

Hard as it might be to admit if your an owner ..... if FB was to tie cable TV to FB membership they would lose just as many as netflix did when they tried to charge for what many people only do because it's free , the valuation would then drop from a speculative growth company to that of a media company ..... which is where it should be already ..... and what that means is 38 dollars a share would still be overvalued based on S&P price to book , price to earnings , or any other measure other than growth or speculation.

FB does have some of the most talented software programmers in the world .... what it's lacking is a sensible plan to make money from their work, and more importantly a plan that would justfy a 100 times earnings valuation.

If you are betting on FB your only hope is that Mark has a plan he has no divuldged to the public because so far he has said nothing that would justify 100 times earnings. Microsoft is in 3 places in half the bulidings in the world and is valued at much less , Apple is the largest growth company in the world and valued at 19 times earnings.

I have been investing and trading for more than 30 years and can tell you with reasonable certianty that FB will go down in history as one of the few stocks that actually didnt fool people into believing it was anything more than bankster hype in the beginning but will also have it's day in the silly bubble limelight and get to 100 before crashing much worse than 38 to 25 .... more like 150 to 25 like so many other overvalued companys like GMCR. But that's years away when today is long forgotten and the internet bubble , housing bubble are replaced by a new bubble.

[MrRealDeal]

One additional note after reading the prior posts ...... one post mentioned that Apple and Google opened with similar vaulations insinuating that everything is just fine ,,,,, thats the 2 out of 5 that made it and fails to recognise that over 500 went from 100 times to 0 .... the reason facebook failed is most of the world learned from the past overvaluations, and while it's easy to sell anything with a .com as a good "investment" in 1995 it's a lot harder in 2012 for what should have been obvious reasons to everyone involved.

Will FB turn out to be a good investment ? No it was a horrible speculative bet .... will FB turn out to make people money ? possibly but only if something drasticly different than is presently known comes along ...... thats a lucky bet not a good investment should that happen.

[midas]

will this result in a temporary spike up?

Facebook Is Secretly Trying to Clone Apple’s iPhone?

http://oakshirefinan...-apples-iphone/

Edited May 30, 2012 by midas

[highchol]

whats with the Apple and Facebook comparisons?

Correct me if im wrong but dont Apple actually make things to sell and make a whole pile of money ?

What dose facebook do?

[midas]

whats with the Apple and Facebook comparisons?

Correct me if im wrong but dont Apple actually make things to sell and make a whole pile of money ?

What dose facebook do?

a Korean guy said the latest Galaxy by Samsung is " awesome "

and he also had the iPhone so stiff competition

[Naam]

whats with the Apple and Facebook comparisons?

Correct me if im wrong but dont Apple actually make things to sell and make a whole pile of money ?

What dose facebook do?

900 million, most probably soon a billion, clowns members generate with their mouse clicks nice revenues for facebook.

[Naam]

The fall in price - particularly when the options started to be trade - is further evidence that people bought the share simply to onsell immediately.

Let's be honest here. This is a poor revenue company. 900 million users created only 1bn profit last year . . just over a dollar a customer. Jeez, a bangkok street noodle seller generates more profit per customer than that.

but you have to concede that both of us would like to have 900 million users generating each 1 cent p.a.

[highchol]

whats with the Apple and Facebook comparisons?

Correct me if im wrong but dont Apple actually make things to sell and make a whole pile of money ?

What dose facebook do?

900 million, most probably soon a billion, clowns members generate with their mouse clicks nice revenues for facebook.

yeah that said a billion dollars for making nothing is not bad if you can get a way it.

would a better comparison be Facebook and Enron?

( not suggesting any dodgey stuff from facebook, mearly that they are a fluff business that dont make or do anything that anybdy needs )

Edited May 30, 2012 by highchol

[MrRealDeal]

The comparison is that they are both tech growth stocks and in the world of valuation comparing them makes some sense. And I mentioned it because prior posters also mentond them. The point was that a compan,y like you mentioned, that makes things, and a pile of money, is not nor should be, valued at less than a company, that as you pointed out does not make a pile of money or make or sell tangable items.

[midas]

Facebook shares plumb new depths, valuation questioned

http://www.reuters.com/article/2012/05/30/us-facebook-shares-idUSBRE84S0VR20120530