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Thread: Facebook IPO

  1. #1
    Speedy Az winner69's Avatar
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    Default Facebook IPO

    Always interesting to see how people see things like this. The only undisputable fact is that several punters will make zillions as a result of the IPO .... while those who want a bit of the action have to takes their chance

    Here's one view as why an IPO
    http://technologyspectator.com.au/em...-ditch-its-ipo

    Lance Wiggs in the NBR did a good analysis on Facebook and its metrics and came to the conclusion its not for him. Plenty of nice charts about user numbers and how much profit per user etc

    http://www.nbr.co.nz/article/opinion...pics-ck-108811

    My view - of course the hype will make this a great IPO

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    Senior Member Halebop's Avatar
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    Agreed. I think a great float to stag if you were lucky enough to get an allocation. ...But a horrible price to pay in the medium term - a lot of growth needs to be acheived to justify the US$75-100b price tag. Still, they make astounding profits for such a young business.

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    Quote Originally Posted by winner69 View Post
    The only undisputable fact is that several punters will make zillions as a result of the IPO ...
    There have been a few interesting articles taht have come out about this. Like the grafetti artist who painted the facebook headoffice and took payment in shares. He should make about $200m out of that.

    And Bono of U2 fame is to become the richest musician ever. Though more than half his money would have come from Facebook. If money is what defines people, does that make Bono an Investor rather than a musician?

    Quote Originally Posted by Halebop View Post
    Agreed. I think a great float to stag if you were lucky enough to get an allocation. ...But a horrible price to pay in the medium term - a lot of growth needs to be acheived to justify the US$75-100b price tag. Still, they make astounding profits for such a young business.
    Agree. I will re-guess closer to the time but my guess is that the first trade will be about 30% higher than the IPO price before dropping down after a day or two or be just higher tha IPO price in the medium term (6 months).

    My understanding is that there will only be 5% new shares issued. Added to that, alot of current investors who bought via the secondary market are locked in for about 6 months. As such, there will be very few existing shares being traded and with only 5% new (even if worth $5B plus), the IPO will definitely be great to stag.
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    Quote Originally Posted by CJ View Post
    Agree. I will re-guess closer to the time but my guess is that the first trade will be about 30% higher than the IPO price before dropping down after a day or two or be just higher tha IPO price in the medium term (6 months).

    My understanding is that there will only be 5% new shares issued. Added to that, alot of current investors who bought via the secondary market are locked in for about 6 months. As such, there will be very few existing shares being traded and with only 5% new (even if worth $5B plus), the IPO will definitely be great to stag.
    So they are raising $16B at a $104B valuation so just over 15% of the company.

    My new guess is a good one to stag but over the next 6 months will be close to IPO value. There will be quite a lot of overhang as there were lots of people who got in early who will want to lock in some/all of the gain. This all depends on what announcements they make over this period. They have the potential to kill Google ads due to much more detailed info on each person.
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    Quote Originally Posted by CJ View Post
    My new guess is a good one to stag but over the next 6 months will be close to IPO value. There will be quite a lot of overhang as there were lots of people who got in early who will want to lock in some/all of the gain. This all depends on what announcements they make over this period. They have the potential to kill Google ads due to much more detailed info on each person.
    It opened up about 10% but looks like the underwriters were doing a lot of buying late in teh day to ensure the price didn't drop below the list price.

    I now expect it will go lower next week.
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    Quote Originally Posted by CJ View Post

    I now expect it will go lower next week.
    Best gig of all these insto's is playing both sides of the fence by taking the short side to buy it all back again.

    You are right though CJ, lower it goes indeed.

    As I type:

    FB is now $33.63 giving it a loss of -12.04% for today so far, but knows where it will close, plenty of old green on the Dow tonight it seems though~!
    --> Watch THRIVE 2011 a must watch Doco! --> Also watch ETHOS 2011 & share the Awareness~!

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    So Zuck is $2B poorer. Big deal. He took $2B off the table at the very high IPO price as did some of the other founders and early investors.

    It is the employees with their share options that will be biting their nails. The employees (and some other later investors) have between 3m and 9 month lock-up clauses so they cant sell straight away. This will cause an overhang in the market as most of these will want to cash out a significant portion before the end of the year. Why? because CGT rates will increase from 15% to 30% (I think).
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    Speedy Az winner69's Avatar
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    So Stanley Morgan screwed all in sundry .... prob the world will learn too late that greed is destroying it ... never mind .... as the story says in a years time this weeks events will only be noise

    Greed blamed as Facebook shares sink
    http://www.nzherald.co.nz/business/n...ectid=10807779

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    I also read some of the selling on Monday related to funds wanting to realise losses so they could make a claim against the NASDAQ as they stuffed up the launch - a techincal issue meant some sales orders didn't to though at the openning price of $42.

    I find the allocation of blame funny though. Sounds like people were buying as they thought limited supply would pus up the price rather than because they through it was actually worth that much. If they thought it wasn't worth that much, they shouldn't have bought!
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    Quote Originally Posted by KW View Post
    . . . I see their revenue model as not being based around advertising in the future . . .
    Interesting that GM agree with you, having decided that Facebook isn't to be part of their advertising mix.

    As for identity services, I can't see any government using Facebook as an identity provider. And since governments are the "gold standard" in identity. . . .

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