OFFICIAL Facebook IPO Thread
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There is still 1.2 billion shares waiting to be unlocked in 177 days: For Facebook Insiders, An Excruciating Wait Has Begun - Forbes
That's one thing we can agree on, Zuck is the man. The falling stock price doesn't hurt him at all because they raised the money they needed.
That being said, those of us that said the stock wasn't worth the IPO price were proven right, and this is why business valuations are based on financial models and not obscure economic theory.
I hope it keeps falling though because I do think Facebook is going to do some big things. But even after the huge losses it's still overpriced.
That's a good question because with the current financials the stock is only worth $8-$12, but I doubt it will get anywhere near that. If you wait too long to buy in you can cost yourself. I don't see this dropping into single digits like Amazon eventually did, but I'm far from a pro so who knows.
I would wait till the next earnings date to get more info on that deceleration rate... whether it's a trend or not. Their Q1 numbers reveal some real concerns and do not justify such a high P/E at this point.
This is a must read on Facebook's valuation (yes, it comes from Blodget but his analysis is spot on)
So, what's a "fair" value for Facebook?
Given Facebook's size, importance, and option value, I'd be willing to pay a modest premium multiple for the company relative to Apple and Google. Those companies have already shown us what they can do, and maybe Facebook really hasn't even stomped on the gas yet. And, yes, Facebook does have the ability to roll out new products that we haven't seen yet.
(So do Apple and Google, of course, but let's ignore that for now).
Bottom line: I think a fair price for Facebook is 20X-30X 2013 estimated earnings.
To be (modestly) conservative, I'll assume that those earnings come in between Wall Street's current consensus--$0.60--and my "aggressive case" estimate--$1.00. I'll use $0.80.
So, a fair price for Facebook might be between $16-$24.
You should have stuck to being the bigger man.
Your "financial models" are based on that obscure theory.
That said, value subjectivity isn't a theory. It's a demonstrable fact.
One day, I dream you will understand the difference between abstractions and facts. I dream.
I just want to boldly proclaim what UG has so eloquently stated previously:
this is why business valuations are based on financial models and not obscure economic theory
this is why business valuations are based on financial models and not obscure economic theory
it was still worth what people were willing to pay that day. so again you are arguing between market value and intrinstic value which are to different things. . . and not debatable as to which a stock price is based. . . . stock price is market value. . .
Please point out the mises.org article that states this. No peer reviewed materials will be accepted, because fuck societies and their whole interaction thing.
It's pointless trying to explain that. I tried.
You have people who love being ignorant and proudly post how ignorant they are because they are trolling. The trick is to not get trolled, trying to improve the level of understanding around here is like putting tits on a bull.
I am a big fan of societies. In order to have a society, one has to be social. Social relations allow for voluntary interactions.
You endorse violence, which is anti-social.
So really, your post is more a reflection of your views than mine.
I was just explaining to someone yesterday that Matt was exactly like this. Well done.