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Facebook shares hit again as valuation doubts rise

reuters.com

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Re: Facebook shares hit again as valuation doubts rise

#11

Post by recoiledsnake »

dacilselig wrote: post #8
recoiledsnake wrote: post #2

Most of the IPO purchasers would've shed their shares on Friday and yesterday(volume was crazy on both days) and now the regular joes are left holding the bag. In fact, some of the big sharks have sold off their shares on Friday and went short on the stock, so they're making bank on this.

Can you tell me which big sharks you are referring to? I know Morgan Stanley is in big, however I don't know much of the other large players.

I would classify Morgan Stanley as a whale, not a shark. Can't find the article right now, but I read yesterday about big client of one of the underwriters saying he went through with the purchase of the IPO but dumped shares early and went short. These are the smart guys.

Re: Facebook shares hit again as valuation doubts rise

#12

Post by gfosco »

lionheart wrote: post #10

I'm not really sure why everybody here is so bearish on FB. Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO. I think Zuckerberg has shown that he knows how to innovate, grow the company, and even make painful changes that eventually lead to more growth and profit. There is at least a decent chance that FB will refine their business model and turn into a large, stabl…

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

Re: Facebook shares hit again as valuation doubts rise

#13

Post by WillyF »

gfosco wrote: post #12
lionheart wrote: post #10

I'm not really sure why everybody here is so bearish on FB. Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO. I think Zuckerberg has shown that he knows how to innovate, grow the company, and even make painful changes that eventually lead to more growth and profit. There is at least a decent chance that FB will refine their business model and turn into a large, stabl…

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

Isn't that Google's model? It's worked out pretty well for them.

Re: Facebook shares hit again as valuation doubts rise

#14

Post by mikemarotti »

tedunangst wrote: post #9
mikemarotti wrote: post #3

Earlier quoted context omitted.

The burden will continue to rest on the middle class until there is no more middle class.

I guess it was my lucky day. I somehow managed to escape being forced to buy FB stock. Maybe I'm upper class now? That'd be pretty sweet.

I tried to come up with an appropriate rebuttal, but you're right - it wasn't the middle class that was taken advantage of here, it was truly the "dumb money" who decided to buy a stock with a 100:1 PE ratio. Point taken.

Re: Facebook shares hit again as valuation doubts rise

#15

Post by lionheart »

gfosco wrote: post #12
lionheart wrote: post #10

I'm not really sure why everybody here is so bearish on FB. Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO. I think Zuckerberg has shown that he knows how to innovate, grow the company, and even make painful changes that eventually lead to more growth and profit. There is at least a decent chance that FB will refine their business model and turn into a large, stabl…

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

They've done several major redesigns that initially the users rebelled against but then came to like.

I can tell you that's not easy to do.

Re: Facebook shares hit again as valuation doubts rise

#16

Post by ceejayoz »

lionheart wrote: post #10

I'm not really sure why everybody here is so bearish on FB. Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO. I think Zuckerberg has shown that he knows how to innovate, grow the company, and even make painful changes that eventually lead to more growth and profit. There is at least a decent chance that FB will refine their business model and turn into a large, stabl…

> Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO.

Most don't go IPO at $100B. Even Google only started at $23B.

Re: Facebook shares hit again as valuation doubts rise

#17

Post by simonsarris »

WillyF wrote: post #13
gfosco wrote: post #12

Earlier quoted context omitted.

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

Isn't that Google's model? It's worked out pretty well for them.

Well, when I look at companies that I might legitimately invest in, arguably the most important question is "what kind of room for growth is there?"

Without getting too deep, its not hard to see Google become more than an ads company in the near future. Google Research. Google (self-driving) cars. Google ISP. Google Space Mining. Google the hardware manufacturer (hello moto).

It's very difficult from my little point of view to see the same thing happening with Facebook. Their room for growth seems an awful lot smaller than most other companies worth investing in, and with their stats (higher market cap than Ford, huge P/E, etc), one would have to expect massive room for growth, but they haven't floated much in terms of monetization ideas other than ads and things that people may not like very much (privacy intrusive things, etc)

Re: Facebook shares hit again as valuation doubts rise

#18

Post by fosk »

lionheart wrote: post #15
gfosco wrote: post #12

Earlier quoted context omitted.

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

They've done several major redesigns that initially the users rebelled against but then came to like. I can tell you that's not easy to do.

Making users accept a UI redesign is one thing. Making lots of billions out of them is another. Plus, advertisers and not regular users are Facebook's paying customers (unless Facebook starts a subscription model). Attracting users to sign up and attracting advertisers to pay are two completely, different, challenges.

Re: Facebook shares hit again as valuation doubts rise

#19

Post by thereason »

lionheart wrote: post #10

I'm not really sure why everybody here is so bearish on FB. Sure, its an unproven company with a high P/E ratio, but so are most tech startups when they go IPO. I think Zuckerberg has shown that he knows how to innovate, grow the company, and even make painful changes that eventually lead to more growth and profit. There is at least a decent chance that FB will refine their business model and turn into a large, stabl…

People here are bearish on FB because they 1. have a conscience and 2. understand the company's business (the simple technology).

People here are bullish on FB because they either 1. lack a conscience or 2. do not understand the company's business (the simple technology), or both.

Re: Facebook shares hit again as valuation doubts rise

#20

Post by gfosco »

WillyF wrote: post #13
gfosco wrote: post #12

Earlier quoted context omitted.

How is there a decent chance of that? Have they refined anything in the past and grown beyond a simple "get users, show ads" model?

Isn't that Google's model? It's worked out pretty well for them.

Google is everywhere, in everything. Google built a platform that allows others to build businesses on.

I'm getting quite scared of them as well, but there's no comparing them with Facebook. Google has moved beyond just advertisements. Android, Chrome, ChromeOS, Autonomous Cars, GMail, to name a few.

Facebook is a colossal failure in the making, and I'm actually enjoying watching the stock fall.

Disclosure: I have no connection to either company. I am a privacy advocate and think both will eventually become harmful to society at large.

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