Are you going to buy stocks in Facebook?

[smart brit]

Just curious how come they flopped as badly as they did.
And waiting for a class action lawsuit (it would be a record to have a lawsuit on a company that went public less then a week

[AsherO]

Just curious how come they flopped as badly as they did.
And waiting for a class action lawsuit (it would be a record to have a lawsuit on a company that went public less then a week

I doubt there will be a lawsuit. It flipped because they really pushed the limits with the amount of shares they issued (and the fact that they priced them @ $33, which was the top of their $34-38 projection.

ETA: Here's another reason for the selloff today (at least what started the downward momentum), I wonder what this mess will cost NASDAQ, and how much of it is actually their fault.

[HelpMe]

Just curious how come they flopped as badly as they did.

...because at the last minute they increased the IPO price and amount of shares being offered.

[AsherO]

...because at the last minute they increased the IPO price and amount of shares being offered.

They did it at the last minute so that they could:

really pushed the limits with the amount of shares they issued (and the fact that they priced them @ $33, which was the top of their $34-38 projection.

[HelpMe]

I think they were worried they would leave some money on the table. It could also be a case that they believed their own hype.

[AsherO]

I think they were worried they would leave some money on the table. It could also be a case that they believed their own hype.

Overkill/overhype, and it's going to cost the underwriters when they have to cover the greenshoe shares.

[PlatinumGuy]

Overkill/overhype, and it's going to cost the underwriters when they have to cover the greenshoe shares.

Help me out.
If MS exercised ther right to oversell by 15%, they have cash worth that amount of stock at the IPO price.
If they bought those phantom shares  when they were trading below the IPO price, they have a net gain.

Did MS have to buy shares when they were slightly above the IPO price?

The other alternative (assuming it's costing them) is that they had to buy back more shares than they had Greenshoe shares.

Even so, the loss would appear minimal if they pocketed a 7% fee on the entire IPO value.

[smart brit]

And after 90  days the lock up period is over there will be a lot of selling by all HF that bought early

[smart brit]

The fees from the IPO is expected to be in the range of 160 mil to be divided between 3 underwriters.
P.s. the fun is starting MS was subpoenaed in FB case

[AsherO]

The fees from the IPO is expected to be in the range of 160 mil to be divided between 3 underwriters.

Weren't there like 31 underwriters?

P.s. the fun is starting MS was subpoenaed in FB case

A link would be helpful:
http://www.reuters.com/article/2012/05/23/us-facebook-galvin-idUSBRE84L1BS20120523
This is going to get real messy, everyone's going to point fingers and some poor guy is going to be the scapegoat/fall0guy.

[elizmm]

Im gonna wait a few more days and then buy a bunch of shares, the stock WILL go up and in a year or 2 will be $80-$120 a share. They platform they have, they will figure out a way to monetize facebook.

Typical ads will not work on facebook, they cannot compete with google because people go to google to find results in order to leave google.com, so google offers you some paid results which you may click on and they earn $$. whereas when people go to facebook they are looking to stay on facebook and they are not interested in clicking an ad about teeth whitening just because someone commented in fb that they whitened their teeth.

Facebook can perhaps make money on ads that just want to build brand awareness (think coke, p&g..) and do not care about actual clicks. They can also charge for a premium version of facebook that allows you to contact people who are private, similar to linkedins premium version.

I can continue rambling but ill spare you the pain..

[AsherO]

Facebook can perhaps make money on ads that just want to build brand awareness (think coke, p&g..) and do not care about actual clicks. They can also charge for a premium version of facebook that allows you to contact people who are private, similar to linkedins premium version.

There isn't much money in either of those two revenue streams can drive their stock to $80+. Brand awareness ROI is too low for companies to spend that much on it. Granted some companies will spend a lot, but they will use as many channels as they can to get broad exposure (instead of sending the same message to the same people ll the time). LNKD premium isn't what's driving their revenue growth, it's recruiting, which is LNKD specific.

P.s. could anyone explain LNKDs in-freakin-sane P/E ratio of 600+?

[smart brit]

Weren't there like 31 underwriters?

A link would be helpful:
http://www.reuters.com/article/2012/05/23/us-facebook-galvin-idUSBRE84L1BS20120523
This is going to get real messy, everyone's going to point fingers and some poor guy is going to be the scapegoat/fall0guy.

the 3 main underwriters were ms gs jpm
I'm sorry was posting from mobile device

[boruch]

P.s. could anyone explain LNKDs in-freakin-sane P/E ratio of 600+?

More like 800+. Have been wondering the same lately. Bought a couple in Dec last year somewhere in the $60's. Time to sell ?! ...

[PlatinumGuy]

Why isn't Google or Apple putting together a (hostile) takeover?

If there's one company in the world FB is worth $100B for, it's Google.
Apple also has loads of extra cash, and really needs to expand in its non-hardware offerings.

[Shmelly]

Facebook can perhaps make money on ads that just want to build brand awareness (think coke, p&g..) and do not care about actual clicks.

GM, the 3rd largest advertiser in the US, disagrees with you.

[PlatinumGuy]

"@WSJ: Breaking: Investors filed suit against Facebook and its underwriters, alleging that changes in analysts forecas... http://t.co/1R2aE4cW"
(Link is for paid subscribers)

[AsherO]

More like 800+. Have been wondering the same lately. Bought a couple in Dec last year somewhere in the $60's. Time to sell ?! ...

I think so, but you might want to get some professional advice

Why isn't Google or Apple putting together a (hostile) takeover?

If there's one company in the world FB is worth $100B for, it's Google.
Apple also has loads of extra cash, and really needs to expand in its non-hardware offerings.

$100B is a huge amount of money, even for Apple (which, mind you, is planning to cut their cash holdings by starting to pay a dividend) and for sure for Google.

[YudiG]

More like 800+. Have been wondering the same lately. Bought a couple in Dec last year somewhere in the $60's. Time to sell ?! ...

id consider getting out of lnkd and into aapl...

[boruch]

id consider getting out of lnkd and into aapl...

bought AAPL last Dec too...