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d000hg

Any of you suckers buy FB stock?


32 posts in this topic

I heard launch day was bad because of a software glitch (paused or delayed trading, IIRC). So I guess the psychology of Wall Street is making it worse now?
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I definitely should have shorted. If ever there was a situation where a stock was so obviously going to go down it was this. They were just so absurdly over-valued I couldn't see any legitimate reason for the stock going up.

Opportunity wasted.
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Facebook can't worth $100 billion. That company isn't making any products, just services and ads. $4B revenue with $1B net income and $2B operating costs? Bloated. Edited by alnite
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[quote name='way2lazy2care' timestamp='1337704777' post='4942251']
They were just so absurdly over-valued I couldn't see any legitimate reason for the stock going up.
[/quote]

Because clearly, all stocks' value is based on legitimate reasons... What's google at again? At least they're doing stuff now, but during their IPO they didn't have much more than a lot of traffic and infrastructure lessons learned either.

And no; I didn't buy any stock. As I don't think they're worthwhile enough to make an account, I certainly am not going to invest in it.
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Most stocks are volatile right after an IPO. That is to be expected.

Many people were hoping for the skyrocketing effects many companies used in the past to get rich quick. That didn't happen. But they also didn't really go too far off the opposite end, either.

I'd give it a month to settle down before seeing if the $38 price was wrong. Based on their financials compared to stocks I know about, based on their revenues I think the $38 was just about right.
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The only people that make money on IPOs like this are institutional investors who got the shares at half price 6 months ago. Most tech IPOs are flops, inflated by those who remember all the people getting rich from IPOs in 1999 and still think it's a good idea.
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[quote name='Telastyn' timestamp='1337714475' post='4942302']
[quote name='way2lazy2care' timestamp='1337704777' post='4942251']
They were just so absurdly over-valued I couldn't see any legitimate reason for the stock going up.
[/quote]

Because clearly, all stocks' value is based on legitimate reasons... What's google at again? At least they're doing stuff now, but during their IPO they didn't have much more than a lot of traffic and infrastructure lessons learned either.

And no; I didn't buy any stock. As I don't think they're worthwhile enough to make an account, I certainly am not going to invest in it.
[/quote]

Google opened at around $100 a share and is currently sitting at $600 a share.

Google is also making significantly more money, for its value, than facebook is. Facebook made 1 billion last year in profits. Google made 10x that amount (at 11.7 billion dollars in profits). Edited by Washu
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Having previously worked in the finance industry, and still knowing several people in it, the advice I was given was to avoid this stock at all costs for the first week or two. Shorting would have been nice had it not been locked, and had I enough money to afford a margin account.

But there were way too many warning signs pre-IPO (excluding the lawsuit and other upcoming legal issues) that anyone with basic investment knowledge would have known that the price was going to dip.
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[quote name='way2lazy2care' timestamp='1337704777' post='4942251']
I definitely should have shorted. If ever there was a situation where a stock was so obviously going to go down it was this. They were just so absurdly over-valued I couldn't see any legitimate reason for the stock going up.

Opportunity wasted.
[/quote]However there was every chance it could have spiked on day 1 and then dropped, which would be quite common for highly-hyped stocks. It looked it was doing so the first couple of hours, I expected that to last longer before any drops... if I'd had the funds I would've been tempted to buy at launch and sell the same day. Glad I didn't.
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I make about a fourth of my income from stocks. Typically you want to play with very safe, very large marketshare companies, Small Caps (high risk, high reward), and of course dividend stocks.

Safe stocks are pretty much market leaders that deals in food, oil, health services, or any vital commodities. (DE, JNJ, XOM)
Safe stocks could be extended into large cap companies who are pretty much fail safe or have a huge marketshare. (GOOG, IBM, APPL, MSFT, WDC)

Risk stocks are typically small caps, we're talking about companies worth less than $200 million who's shares are worth less than $10 a pop (sometimes even less). You play them for boom or bust (and tax write offs)...

Facebooks is not a safe stock. It is not a market leader (remember it's an ad company), it's not an time tested company, and it is not a necessary market. (Even if it was a necessary market, social media sites come and go...)

That makes FB a risk stock... but is it a risk stock that's worth it?

1st Red Flag: $20B company listed at $100B.
2nd Red Flag: Heavy Competition: (Both big and small aim to take over social media space)
3rd Red Flag: Limited Core Business Growth. My personal belief is that their ad market is capped out. They're not going to be able to squeeze much more out of ad revenues without branching out to other businesses. Typically when you look at risky stocks you want to see HUGE growth potential in their core market. The more a company extends out from their core business the less effective they tend to become. (Personal belief, take a look at HP)

I'm passing on FB, unless it falls down into the teens... I could pull the trigger on a long $18 facebook



*Note: I own some shares of some of the companies mentioned* Edited by BronzeBeard
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I don't trade stocks, but my instincts here told me that FB was overvalued; their actual profit is only via ads. I expected it to perform poorly and gradually drop over the course of a couple of years as people realised the hype was unfounded. Wasn't expecting such a drop, though.
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[quote name='BronzeBeard' timestamp='1338086322' post='4943611']
I'm passing on FB, unless it falls down into the teens... I could pull the trigger on a long $18 facebook
[/quote]
Now that Facebook is down under $18, are you going to buy?
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[quote name='cronocr' timestamp='1346786104' post='4976537']
What happens if stocks fall down to $0? Will the company become bankrupt?
[/quote]

It is (almost?) unheard-of for stock to be literally worthless. Even bankrupt companies have some assets to offset their debts, and the assets are worthwhile even if going through bankruptcy proceedings to absolve/restructure debt.

What will happen though is that a stock will become de-listed from its exchange. Different exchanges have different rules. The NYSE's for example is something like closing under $1 for 30 consecutive days. The stock still exists and still has (fluctuating) value, but is no longer traded on that market (if I understand correctly).
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[quote name='Telastyn' timestamp='1346790122' post='4976563']
[quote name='cronocr' timestamp='1346786104' post='4976537']
What happens if stocks fall down to $0? Will the company become bankrupt?
[/quote]

It is (almost?) unheard-of for stock to be literally worthless. Even bankrupt companies have some assets to offset their debts, and the assets are worthwhile even if going through bankruptcy proceedings to absolve/restructure debt.

What will happen though is that a stock will become de-listed from its exchange. Different exchanges have different rules. The NYSE's for example is something like closing under $1 for 30 consecutive days. The stock still exists and still has (fluctuating) value, but is no longer traded on that market (if I understand correctly).
[/quote]

It will be traded in a different market. [url="http://www.google.com/finance?q=PINK%3ACCTYQ&ei=3m1GULDMC8iMiAKJfA"]Circuit City, for example, is now on the OTC Pink market, valued at $0.002.[/url]
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[quote name='Auth' timestamp='1338329454' post='4944456']
I never purchase launch iPO's.
[/quote]"It's probably overpriced." I have not purchased any FB stock, because advertising looks too competitively razor-thin for any such company to be appealing. And I don't really want more ads, so that limits what growth I would even [i]like[/i] to see from this or any company.
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1,887 page views and 9,001 "yes" votes? [img]http://public.gamedev.net//public/style_emoticons/default/huh.png[/img]

I don't buy stocks. However, I was incredulous when I heard all of the hype surrounding the IPO. I kept looking back to MySpace. It was facebook before facebook was facebook. Now it is a hollow shell of itself. Social media is too new and changes too fast. One paradigm shift and facebook is no more.

I wasn't the least bit surprised when the IPO tanked.
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Really this is all pseudo-investing. Notice that you are all valuing the stocks in dollars. FIAT dollars that we have today aren't backed by anything, so all stock is essentially worthless and that is why all stocks eventually go to 0 value. The only way to preserve and grow your wealth (without getting lucky and gambling in the market) is to invest in something of value, like precious metals or real estate. Things that have consistently kept value for thousands of years. Look into silver, it has tons of applications in industry and has nowhere to go but up. Or you could go with a standard approach and buy gold -- REAL money with REAL value that has never lost value.
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Maybe the best way to think of stock investing is like social security on the open market: A well orchestrated ponzi scheme.

Here's a video that might get you more on the right way of thinking for investors:

http://www.youtube.com/watch?v=5TQhl58GAxI
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