For those that think FB is a good buy

Quote from hajimow:

There is a big difference between AMZN and FB. AMZN has not pissed off investors. FB has.
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You've made the case for a sentiment-extreme. IMO, FB does not touch 18 in 2012. No, I don't own a single share or delta, natural or synthetic.

I am not stating it's going to thirty in a month, but let's see all your runs with the massif short positions. My guess is that none of you are short a single share of FB.

And FWIW, I spend about 5 minutes a week on FB.
 
I think FBs' largest source of revenue will end up being data-mined personal info sold to Government and private marketers. This is often overlooked in the FB debate. Still, I wouldn't own it.
 
Quote from atticus:


And FWIW, I spend about 5 minutes a week on FB.
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That might be about the most anyone does anymore lol!

Seriously though, FB is complete and total trash. It is a serious pit of garbage. Another company basically proved that 80+% of clicks they were charged for were false - and FB didn't even respond to the charge.

I think ol' Zuck just realized that counterfeiting money always gets people arrested, so he decided that clicks=money and why not counterfeit the clicks? I seriously think the SEC/FBI/Secret service need to investigate these guys - if there has EVER been ONE click that was fraud, the company should be shut down.

JJacksET4
 
Quote from Pekelo:

For tech stocks, fundamentals don't apply. AMZN went up from $40 to $240 in the last 4 years.
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Where have I heard this before? Oh yeah...late 90s. YHOO went from $20 per share to $500 in 3 years. Whats it trading at now? Oh yeah...$15.

First rule of investing....Fundamentals ALWAYS apply. P/E ratio will always come back down to earth whether in the form of a crash, or in the form of staying the same price for 10+ years.
 
Good statement, but you have a problem -Facebook has 1 billion users, and there are 7 billion people in the world. Are you suggesting that with their top rate performance they will level off at 1 billion forever? You said 90%, which is completely wrong. Facebook has under 50% of the current internet market share, and much less share counting the people who will be using the internet in the close future.

I wish so many people wouldn't emotionally hate Facebook. I'm not buying now, but HurricaneUS is wrong in this case.

Quote from peilthetraveler:

Lets say there is a restaurant on an island and most of the people on the island eat at this restaurant. Now there are a few other restaurants, but by far 90% of the island eats at this restaurant....(Well call the restaurant Fish Bucket, or FB for short) :) So the owner of Fish Bucket decides he wants to sell. How much does he want to sell it for. Well the business makes $100,000 per year so the owner of Fish bucket, Mike Zacharyburg, decides to put it up for sale for $7,170,000. Now, we know the business can't keep growing much because nearly everyone on the island eats there, and there is always a risk that a new restaurant might pop up one day that sells better tasting fish. After all...Fish Bucket did once replace "MyFish" as the number one restaurant on the island some years back.


So tell me...would you buy Fish Bucket for $7.1 million dollars when it only makes $100k per year and you know it cant grow much more and it runs the risk of being replaced by a new restaurant one day?

Because Facebook and Fish Bucket are the exact same thing (at todays closing price of $20.72.) Fish Bucket is just scaled down.

It shocks me that so many people just hear "facebook" and no price matters. The name is popular enough to justify the price in their eyes.
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Quote from peilthetraveler:

Where have I heard this before? Oh yeah...late 90s. YHOO went from $20 per share to $500 in 3 years. Whats it trading at now? Oh yeah...$15.

First rule of investing....Fundamentals ALWAYS apply. P/E ratio will always come back down to earth whether in the form of a crash, or in the form of staying the same price for 10+ years.
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Yes :D

Amazon -with all the failing retail co's, Amazon is expected to really grow. This is why their price is big. :)
 
Quote from achilles28:

I think FBs' largest source of revenue will end up being data-mined personal info sold to Government and private marketers. This is often overlooked in the FB debate. Still, I wouldn't own it.
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You may well be right, but this in a way is even worse than charging for an account. People would desert it in droves if they got the idea that Big Brother was watching. Of course, it doesn't seem to hurt GOOG, so I may be wrong.

For now however, FB hasn't shown any ability to generate actual money. This is a crucial distinction with GOOG, which a lot of investors didn't understand but they could see it produced money.

Another factor that would worry me if I were an institutional holder of FB is Zuckerberg. It is one thing to give up virtually all voting control to a Steve Jobs. I wasn't exactly blown away by him on the last CC.
 
Recently FB has even more garbage on the main part of the site "the timeline" there are way more frequent ads and other annoying crap, New frequent unwanted notifications that started the past couple weeks.

Now that it's public , they will add more garbage to try to monetize and it will just drive more people off it.


Myspace downfall turned into an ad infested craphole too.
 
Quote from AAAintheBeltway:

You may well be right, but this in a way is even worse than charging for an account. People would desert it in droves if they got the idea that Big Brother was watching. Of course, it doesn't seem to hurt GOOG, so I may be wrong.

For now however, FB hasn't shown any ability to generate actual money. This is a crucial distinction with GOOG, which a lot of investors didn't understand but they could see it produced money.

Another factor that would worry me if I were an institutional holder of FB is Zuckerberg. It is one thing to give up virtually all voting control to a Steve Jobs. I wasn't exactly blown away by him on the last CC.
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Truth be told, lots of these tech giants - GOOG, FB, ebay, paypal - have ties to the CIA. Most were founded or provided seed money through In-Q-Tel or one of it's partner organizations. In-Q-Tel is a CIA venture capital outfit that funds tech startups. Whether that holds any water to FB's longevity, probably. It's public information companies like google and FB now work with the NSA on "cyber-security initiatives" etc. This all lends me to think that even if FB can't generate a profit, so long as it remains popular, it'll continue to operate.
 
Quote from colonial dr:

Good statement, but you have a problem -Facebook has 1 billion users, and there are 7 billion people in the world. Are you suggesting that with their top rate performance they will level off at 1 billion forever? You said 90%, which is completely wrong. Facebook has under 50% of the current internet market share, and much less share counting the people who will be using the internet in the close future.

I wish so many people wouldn't emotionally hate Facebook. I'm not buying now, but HurricaneUS is wrong in this case.
Yes :D

Amazon -with all the failing retail co's, Amazon is expected to really grow. This is why their price is big. :)
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and of those 7 billion about 1.5 billion are children leaving 5.5 billion. And of those 5.5 billion left only 83% are literate leaving 4.5 billion. Another 750 million are old and not likely to use facebook leaving 3.75 billion. 1 billion already use facebook so thats 2.75 billion potential customers. Of course, China has its own social networks Qzone, renren, 51.com, and Kaixin001 which comprise pretty much most of the internet using chinese market. (743 million users combined as of 2010) So that leaves 2 billion potential customers.

Remember though that 60% of the worlds population lives on less than $2 per day. So its a good bet since most of the people that have computers and internet are already on their social networks, that those leftover 2 billion are probably a good portion of the 2 billion that do not have enough money for internet or computers or even live in areas with access to computers. Dont forget about the millions of people in prison that wont be using facebook. I estimate that BEST case scenario is facebook could grow by 50% and then will only grow with world population growth. This means that facebook, once all the hype is gone will be worth at best no more than $11 with a 25 P/E ratio in my opinion.
 
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