Anyone Betting on Facebook?
- Thread starter cactiman
- Start date
Yeah, you never know...Google+ isnt working out very well for google so they might buy it. I thought GOOG was crazy 6 years ago when they bought a little website for $1.65 billion that only had net income of about $3.6 million per year. Whatever happened to that website? I think it was called youtube or something like that.
Anyway, $4 per share is still around a $8.5 billion valuation. It all eventually will come down to numbers after all the hype is gone. And the numbers are looking pretty scary. If you take the best analyst estimates and use a P/E ratio the same as google, then this stock is worth at the most $19 per share. You take the worst estimates and the stock is worth $7 per share. (of course these are the new "higher" numbers that I'm using and not the numbers they were using a few months ago, when analysts expected facebook was going to lose money for 2Q. Lets see what happens when 2q numbers are released. I think its going to be negative and facebook will be trading $10 to $15 after that.
stephen31,
You cuss a lot, but do seem to be a nice guy, so Peace back at ya.
I made a very small bet on the Brains & Cash at FB finding some kind of solution to their monetizing problem, by January 18, 2013.
At least enough of a solution to ensure the stock price will be 8% LOWER than when I entered the trade! (25 vs. 27.19)
This doesn't seem at all impossible to me.
I also waited for the price to fall from 45 to 27 before pulling the trigger.
So I'm not feeling like a sucker or anything - as the traders buying on day #1 must feel by now!
If FB keeps falling I won't add to the trade.
If FB consolidates and then starts an Uptrend, I might add to the position little by little.
If FB is well below 25 after Earnings are announced in the Autumn, I'll close the trade and eat the loss.
Meanwhile, I plan on enjoying the Soap Opera!
Glad you responded.
Was just interested in your 'personal' strategy.
I rant alot (it gets the poison out); most of my rants are aimed at lousy traders who might be reading my profanity-ridden rants to get them to ACT out a different storyline in their heads--towards at least some longer-term net profitability.
This may be a game but score is kept with quite a few shekels if one gets it right at least 50% of the time with a good risk/reward and proper trade management 'topped off' with keeping one's head on straight throughout the entire trade sequence.
peace
hedvig
Was just interested in your 'personal' strategy.
I rant alot (it gets the poison out); most of my rants are aimed at lousy traders who might be reading my profanity-ridden rants to get them to ACT out a different storyline in their heads--towards at least some longer-term net profitability.
This may be a game but score is kept with quite a few shekels if one gets it right at least 50% of the time with a good risk/reward and proper trade management 'topped off' with keeping one's head on straight throughout the entire trade sequence.
peace
hedvig
Good points indeed, and I appreciate your concern.
I do want this trade to work of course, but by no means am I betting the farm on it.
A Total Maximum Loss in January (which I'd have to be in a coma to let happen!) would only amount to -00.28% of my Equity; versus a possible maximum of -2.00% per trade my rules allow.
So I meant it when I said a very small initial purchase!
Quote from cactiman:
Canadian Venture Stocks? Any examples come to mind?
As to US Options, I don't Buy Singles at all anymore.
These days I'm just a Net Seller via Vertical Spreads and Iron Condors.
Sure. Here's one I'm long at the moment. Please note though - I would never in a million years recommend a venture stock to anybody. You have to watch these things like a hawk and be very familiar with the myriad ways penny promoters scam you. I am not suggesting you buy GQC; I'm just showing you how these things move (occassionally) like options.
On this site, stockscores.com, there are thousands of charts and each one has a bullboard accessible below the chart. Be warned - at least half the people involved in these chats are professional pump-and-dumpers.
This particular stock found a gold ore body in the Dominican Republic. It may be bona fide or it may be a scam. Time will tell.
http://www.stockscores.com/quickreport.asp?ticker=v.gqc&x=10&y=3
Here's articles I just read about the TSX Venture Exchange and Penny Stocks (U.S. version of the same?).
Don't worry, I won't be doing either! But certainly was interesting to find out about - thanks.
http://en.wikipedia.org/wiki/TSX_Venture_Exchange
http://en.wikipedia.org/wiki/Penny_stock
FB held up OK on Friday, with the 26.83 low (at the bottom of Thursday's "Hammer") never threatened. The volume was quite low too. I guess, for one day at least, everybody decided to sell everything else instead!
But this quote from a recent blog doesn't inspire much confidence in FB's future price levels...
"A major risk for investors in recent IPO's is when the "lockup" period expires. Many insiders are typically restricted from selling all their shares for at least 90 to 180 days after the IPO. According to one article, Facebook could see about 286 million additional shares available for sale in about 3 months, and a massive 1.7 billion shares within 6 months. Both Groupon and Zynga shares have seen accelerated declines in the share price as their lockup periods drew near and expired. Facebook is likely to see the same downside pressure when more shares become available for sale. A $20 per share level could become a more reasonable valuation, yet still give the company a premium valuation at about 40 times earnings."
:eek:
But this quote from a recent blog doesn't inspire much confidence in FB's future price levels...
"A major risk for investors in recent IPO's is when the "lockup" period expires. Many insiders are typically restricted from selling all their shares for at least 90 to 180 days after the IPO. According to one article, Facebook could see about 286 million additional shares available for sale in about 3 months, and a massive 1.7 billion shares within 6 months. Both Groupon and Zynga shares have seen accelerated declines in the share price as their lockup periods drew near and expired. Facebook is likely to see the same downside pressure when more shares become available for sale. A $20 per share level could become a more reasonable valuation, yet still give the company a premium valuation at about 40 times earnings."
:eek: