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Facebook to Set I.P.O. Price Range at $28 to $35

dealbook.nytimes.com

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Re: Facebook to Set I.P.O. Price Range at $28 to $35

#21

Post by gsharm »

nirvana wrote: post #3

Why oh Why is the headline about the stock price? Apple's price is $585ish right now. Apple is not 10 times more expensive than Facebook would be-- only a bit more than 5 times as expensive. Facebook's price range is around $86B. It seems a lot of people want to buy a car for a "monthly payment they can afford" and car dealers have long sold people terrible terms and terribly overpriced cars by structuring the "month…

Mark has gathered a lot of great people, and they're focused. I wouldn't underestimate them.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#22

Post by LaGrange »

nirvana wrote: post #3

Why oh Why is the headline about the stock price? Apple's price is $585ish right now. Apple is not 10 times more expensive than Facebook would be-- only a bit more than 5 times as expensive. Facebook's price range is around $86B. It seems a lot of people want to buy a car for a "monthly payment they can afford" and car dealers have long sold people terrible terms and terribly overpriced cars by structuring the "month…

"It seems a lot of people want to buy a car for a "monthly payment they can afford" and car dealers have long sold people terrible terms and terribly overpriced cars by structuring the "monthly payment" lower so the person thinks the car is cheaper. Its amazing people fall for this."

Because people actually know they're getting ripped off, but they need the car, and they can't afford anything above the "monthly payment" — not buying the car later, not paying a higher payment. To reap the rewards in x years you first have to survive them.

Of course, this doesn't apply to the IPO anymore.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#23

Post by runako »

tobias3 wrote: post #17

That would be approx. $94 per active user. I know there have been social networks which went over the counter at that price before, but looking at them now I would not touch this stock with a ten foot pole. I certainly can't think of any way to extract that much money from my account. Ads? I know that this reflects not the current status but future expectation, but I cannot imagine any way how Facebook can fulfill th…

Put another way, Facebook is expecting to be able to create $94 of cash for each of its current active users over the future to eternity, discounted by an appropriate factor. That doesn't seem outlandish: it's $0.80/mo per user of value over 10 years. If they add users, it's less. If they add/extend their product offerings/partnerships/etc., the numbers seem a lot more achievable.

That said, I'm not buying the IPO because it seems fully valued already.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#25

Post by ChuckMcM »

jonursenbach wrote: post #15

So how can us normals get in on this?

If you mean "How can I buy stock at $25 and sell it right away to the general public for $35 to $50 on the same day?" Then the answer is, "Sorry, you can't."

If you mean "How can I create a company that will allow me to sell a future interest in the company for way more than I put into it?" Well that answer is "Play the tech startup game."

During the Dot-Com bubble a company often had a 'friends and family' plan where if you had a family member working there or knew someone you could participate in some small way in the IPO. I know families that no longer talk to each other (even now over a decade later) because of that 'opportunity' so I'd approach it with caution if offered.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#26

Post by seanalltogether »

nirvana wrote: post #3

Why oh Why is the headline about the stock price? Apple's price is $585ish right now. Apple is not 10 times more expensive than Facebook would be-- only a bit more than 5 times as expensive. Facebook's price range is around $86B. It seems a lot of people want to buy a car for a "monthly payment they can afford" and car dealers have long sold people terrible terms and terribly overpriced cars by structuring the "month…

> "Its amazing people fall for this."

I imagine for the common man, "investing" is nothing more then betting on who will win the popularity contest. None of us will be able to invest in facebook, we're just buying the chips off of those that did.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#28

Post by wavephorm »

tobias3 wrote: post #17

That would be approx. $94 per active user. I know there have been social networks which went over the counter at that price before, but looking at them now I would not touch this stock with a ten foot pole. I certainly can't think of any way to extract that much money from my account. Ads? I know that this reflects not the current status but future expectation, but I cannot imagine any way how Facebook can fulfill th…

There is no way each of their users can possibly be worth that price. They've done a good job at hyping up the company, but from an investment standpoint, it's dead meat. They really need to pull a rabbit out of their hat at this point -- some feature that would make 10%+ of their "consumers" to pay money for a product they offer.

Re: Facebook to Set I.P.O. Price Range at $28 to $35

#30

Post by adamtmca »

nirvana wrote: post #3

Why oh Why is the headline about the stock price? Apple's price is $585ish right now. Apple is not 10 times more expensive than Facebook would be-- only a bit more than 5 times as expensive. Facebook's price range is around $86B. It seems a lot of people want to buy a car for a "monthly payment they can afford" and car dealers have long sold people terrible terms and terribly overpriced cars by structuring the "month…

This is an article on dealbook - everyone reading knows the difference between market cap and price per share and the market cap is in the first paragraph. Headlines include the price per share of stocks all the time, it doesn't mean the readers or writers are stupid.
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