<20 Minutes before FB goes live on Stock Market

[semaphore]

Sure, but the normal rules for profit and valuation don't really apply to companies like Facebook. It's not so much an investment in the company as it is, as it is an investment what it can and will become. Facebook's done with it's growth phase, it can now move on to it's monetization phase, becoming the backbone for other services.

I feel like a lot of people just want to own Facebook shares because they use Facebook so much, and not so much as an actual investment.

[Jackmoves]

Sure, but the normal rules for profit and valuation don't really apply to companies like Facebook. It's not so much an investment in the company as it is, as it is an investment what it can and will become. Facebook's done with it's growth phase, it can now move on to it's monetization phase, becoming the backbone for other services.

Yes and that service might be worth quite a lot if they do it right, which is why I think a share price of around x10 the profits would be quite ok, thats still about the double valuation of a normal companies shares. 38$ per share is just a massive joke.

[Deleted]

The time of the .com boom has long past and yet this seems like a throwback to those times.

They don't produce a profit like other businesses do and in perspective these share prices are absolutely obsene. Seems to be the owners of facebook are cashing in at the height of facebook popularity and when your sitting on a couple of billion there's little you need to care about.

Three things will happen in the next few months:
1) Facebook share price will plumet.
2) Facebook will offer benefits to shareholders which integrate into their accounts to compensate for the expected low dividend.
3) Facebook will increase advertising dramatically or add microtransaction charges for games, groups, posts and more.

[Stataclysm]

Dont know much about stocks, but my take on this is simply that social networking sites come and go. There are so many new innovations when it comes to this area, that FB is on thin ice imo. Look how fast twitter grew? What will be the next site? If you had invested in FB a few years ago it could have made you some money, but now i think its too late

[Maharishi]

I feel like a lot of people just want to own Facebook shares because they use Facebook so much, and not so much as an actual investment.

Maybe they are, but the valuation of 38$ was set by brokerage firms, not by Joe Blow picking up a couple of shares.

Yes and that service might be worth quite a lot if they do it right, which is why I think a share price of around x10 the profits would be quite ok, thats still about the double valuation of a normal companies shares. 38$ per share is just a massive joke.

That's your opinion, but this is an absolutely unique case in terms of IPOs. I really don't know how I'd value you them, but I think their to date profits don't really matter at all. It's about the next ten years, not the last ten.

[Pony Soldier]

internet would be better without fb, imo.

You're right. I think internet would be better without any social sites imo.

[Lucetia]

As many have mentioned, buying now wouldn't be the best investment you could make. Facebook is at it's height and there's not really much more they could do that they haven't.

[Brewski]

Facebooks popularity is declining, a lot of people are closing their accounts... it will be the next myspace in terms of falling off the face of the earth.

[Deleted]

Facebooks popularity is declining, a lot of people are closing their accounts... it will be the next myspace in terms of falling off the face of the earth.

Not true. Facebooks popularity is growing, but the rate of growth is slowing down.

[BreakingBad420]

Theres not much room for growth when over 900 million people use facebook... unless we start handing out computers and internet to people who live in the Amazon.

[Deleted]

Buy some instantly as soon as it opens. Sell them 10 minutes later.

Bit late for that now

[Jackmoves]

That's your opinion, but this is an absolutely unique case in terms of IPOs. I really don't know how I'd value you them, but I think their to date profits don't really matter at all. It's about the next ten years, not the last ten.

It's all speculation idd, but what they've done now is basically that they've maxed out the potenial future value of FB, there is little space for the share to be a worthy investment as it is now.

It's quite fun to if you compare it to Giants such as Apple and Google as well, then the share price really becomes baffling.

Theres not much room for growth when over 900 million people use facebook... unless we start handing out computers and internet to people who live in the Amazon.

It doesn't really matter though, what matters is if they can make as much profit from it as the share price suggest, that is what will decide the actual value of the investment. Of course it helps to have as many users as possible.

[BreakingBad420]

Yeah I was just referring to user growth,I think that they have many options to grow financially, information is valuable afterall, having close to a billion peoples likes and dislikes would be great to sell to companies so they can maximize their profits by catering to what people like on facebook without having to revert to more ads.

[Illuwin]

All of these tech companies trading at 100-200+ times earnings are going to lead us straight into another .com crash.

[Reeve]

Sure, but the normal rules for profit and valuation don't really apply to companies like Facebook. It's not so much an investment in the company as it is, as it is an investment what it can and will become. Facebook's done with it's growth phase, it can now move on to it's monetization phase, becoming the backbone for other services.

Almost these exact same words were used to describe web-based startups in the late 90s before the dot com crash. I don't claim to know if that's what will happen with Facebook, but it sure does make me nervous as hell to see those same sentiments.

[Bathory]

I now own part of FACEBOOK!

HAHAAHAHAHAHAHAHA

[Emberhelm]

Nope, I will not buy shares because FB is on the way out, Twitter is reigning supreme ATM, with G+ following behind. Social sites will continue on their current cycle.

[Dylicious]

I've never bought stocks. I have no clue where to even go with it, and even if I did, my lack of experience would prevent me from buying just because I wouldn't know what to do. Therefore, I wouldn't want to risk my money at the (high) probability I'll screw up.

This is sad when I read things like this, even if personal finance might bore you most of it is fairly simple. For most people, trying to buy individual stocks is a poor decision (how would you buy 100 shares of AAPL, which is valued at ~$533? Not to mention the risk of having a narrow portfolio) and unless you're a high net-worth investor, you probably won't be getting in on buying individual stocks or IPOs like Facebook. The worst thing you can probably do with your money is sit on it, because you're missing out on the returns you can gain and you're losing against inflation. A diversified, index stock mutual fund would be your best choice. You'll put your money to work without having to scour through market data every second of every day. Look for long-term gains. Don't buy into get-rich schemes; the odds of beating the market are not in your favor.

investopedia.com, marketwatch.com, just a couple places to start reading.

That's your opinion, but this is an absolutely unique case in terms of IPOs. I really don't know how I'd value you them, but I think their to date profits don't really matter at all. It's about the next ten years, not the last ten.

Right, the price is basically the present value of future expected dividends and the sentiment is that it's been overvalued, so buying now is more speculation than investment. Facebook's future growth probably won't be from an expanding user base, but from new applications and services.

[Stanton Biston]

$109B market cap should be where people are concerned.

That's more than half of what Google is. And slightly less than Microsoft.

So yeah, pure speculation.

[Millennía]

Facebook is slowly going to destroy itself because they are under pressure from wall street to generate increasing amounts of profit each year and to do this they are setting up the micro-transactions like the ones they are testing in New Zealand. I think this will put people off big time and eventually they may close their accounts. Only time will tell