Author Topic: FB - Facebook  (Read 159626 times)

biaggio

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FB - Facebook
« on: August 16, 2012, 07:55:46 AM »
Not a fan myself (Too old probably. My teenage kids, and older family members use it)

Not a shareholder, but with stock price tumbling and folks perhaps indiscriminently selling (selling just because price is down)recently I thought I would have a peak at their 10Q.

http://sec.gov/Archives/edgar/data/1326801/000119312512325997/d371464d10q.htm

Positives:

Have net cash of $8.4 b with 377 million shares or $22 per share but shares selling for $19 and change this am.

Negative- did not make any money this quarter + it looks like the employees are enriching themselves (share based compensation of $1.2 billion, significantly increased R&D expense of $700m+ that I am sure some goes to their employees/management)

I don t know that I like the character of the leadership, just the little bit that i have seen. Nothing concrete just a general feeling.

Posting because  I was surprised that it is selling for less than net cash.

EDIT: Sorry guys, I figured I screwed something up- forgot to add the B shares..that's 1.9billion shares or $4.42 per share.  That makes more sense
« Last Edit: August 16, 2012, 09:34:20 PM by Parsad »


NormR

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Re: FB-Facebook
« Reply #1 on: August 16, 2012, 08:00:30 AM »
Be sure to tally up the share count (& dilution) carefully.  Some of the major data providers aren't really counting everything yet ...

biaggio

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Re: FB-Facebook
« Reply #2 on: August 16, 2012, 08:01:47 AM »
Be sure to tally up the share count (& dilution) carefully.  Some of the major data providers aren't really counting everything yet ...

thanks ,I caught that right after I posted

Total shares more like 1.9 billion

racemize

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Re: FB-Facebook
« Reply #3 on: August 16, 2012, 08:04:13 AM »
yeah, I was about to say, if FB is a net net something has gone horribly wrong.

Kraven

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Re: FB-Facebook
« Reply #4 on: August 16, 2012, 08:40:35 AM »
FB is one of those spectacular investments that makes people a lot of money.  Spectacular in the sense that it operates to transfer a lot of money from Joe Retail Public to the good folks at FB and their bankers and other advisors.  FB may or may not end up being a long lasting company, but it has a long way to go until it's stock is worth looking into.
Buy cheap and something good might happen.

LC

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Re: FB-Facebook
« Reply #5 on: August 16, 2012, 09:38:41 AM »
FB is one of those spectacular investments that makes people a lot of money.  Spectacular in the sense that it operates to transfer a lot of money from Joe Retail Public to the good folks at FB and their bankers and other advisors.  FB may or may not end up being a long lasting company, but it has a long way to go until it's stock is worth looking into.
Agreed. From what I remember when I looked at their financials upon IPO, most of their profit is going straight to employee stock options. And if I recall this fact didn't look like it would change for at least a year or so. Same story with Zynga as well.
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Uccmal

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Re: FB-Facebook
« Reply #6 on: August 16, 2012, 10:55:39 AM »
I looked briefly at it.  They have enormous reach and if executed properly could be extremely profitable.  That said, they are probably approaching a steady state of users, so how to monetize.

Impossible to value.  Maybe another Google, or Msft, maybe not.
GARP tending toward value

Liberty

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Re: FB-Facebook
« Reply #7 on: August 16, 2012, 11:20:59 AM »
Social networks remind me a bit of webmail back in its heyday. Microsoft paid hundreds of millions for Hotmail only to realize that it was hard to monetize because people go there to look at emails, not ads.

If you search for "luxury car" on google and see ads for BMW and Mercedes, that's useful to you because that's what you were looking for. But ads on the side of your social feed on facebook?

Some will argue that they can be very targeted because of all the info that Facebook has on you, but it still doesn't change the fact that you're not looking to buy stuff, and even if you are, there's no clear way to signal that intention like with search. Then that leaves more "branding" type of ads, but those are a lot less valuable and effective, and can easily be ignore because they're not showing something you are looking for at that moment.

Then they'll probably try to keep pushing further the whole "your company needs a strong presence on FB with a brand page", but how valuable is that? Good way to communicate with your customers and remind them about you, but if I'm looking for info on a BMW, will I go to BMW's FB page or to their official website? And even if I go to the FB page, will any info be there? Is the company going to re-build their whole website on a platform they don't control, or just throw you to the existing site with a link? So how much can FB charge for these brand pages?

Then maybe they'd decide to pull a Google and go into search and syndicated ads via an exchange, but what are the chances of success there? Even partnering with Microsoft - who has only lost billions on search and ads so far - would what FB has really be some secret sauce to take search to the next level? Is all the crap that people post on FB really the way to make search better for users or will it just clutter up results with junk? I'm sure advertisers would love better demographics info, but it's the user experience that makes web tools succeed or not.. We'll see.

/thinking out loud

I don't have a horse in this race anymore, though. I made about 25% in GOOG in a month and then sold it to buy something more undervalued... It was luck that it turned out that way, but I still believe GOOG should do well over time, though it isn't nearly as cheap now as it was at 475.
« Last Edit: August 16, 2012, 11:44:02 AM by Liberty »
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racemize

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Re: FB-Facebook
« Reply #8 on: August 16, 2012, 11:24:48 AM »
Social networks remind me a bit of webmail back in its heyday. Microsoft paid hundreds of millions for Hotmail only to realize that it was hard to monetize because people go there to look at emails, not ads.

If you search for "luxury car" on google and see ads for BMW and Mercedes, that's useful to you because that's what you were looking for. But ads on the side of your social feed on facebook?

Some will argue that they can be very targeted because of all the info that Facebook has on you, but it still doesn't change the fact that you're not looking to buy stuff, and even if you are, there's no clear way to signal that intention like with search. Then that leaves more "branding" type of ads, but those are a lot less valuable and effective, and can easily be ignore because they're not showing something you are looking for at that moment.


This has always been my thought on the Google/FB debate.  It seems like there was consensus behind it for a while a year or so ago, but then everyone went crazy for targeting.  I still think intent is the important aspect.

valueInv

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Re: FB-Facebook
« Reply #9 on: August 16, 2012, 11:45:27 AM »
Social networks remind me a bit of webmail back in its heyday. Microsoft paid hundreds of millions for Hotmail only to realize that it was hard to monetize because people go there to look at emails, not ads.

If you search for "luxury car" on google and see ads for BMW and Mercedes, that's useful to you because that's what you were looking for. But ads on the side of your social feed on facebook?

Some will argue that they can be very targeted because of all the info that Facebook has on you, but it still doesn't change the fact that you're not looking to buy stuff, and even if you are, there's no clear way to signal that intention like with search. Then that leaves more "branding" type of ads, but those are a lot less valuable and effective, and can easily be ignore because they're not showing something you are looking for at that moment.

Then they'll probably try to keep pushing further the whole "your company needs a strong presence on FB with a brand page", but how valuable is that? Good way to communicate with your customers and remind them about you, but if I'm looking for info on a BMW, will I go to BMW's FB page or to their official website? And even if I go to the FB page, will any info be there? Is the company going to re-build their whole website on a platform they don't control, or just throw you to the existing site with a link? So how much can FB charge for these brand pages?

Then maybe they'd decide to pull a Google and go into search and syndicated ads via an exchange, but what are the chances of success there? Even partnering with Microsoft - who has only lost billions on search and ads so far - would what FB has really be some secret sauce to take search to the next level? Is all the crap that people post on FB really the way to make search better for users or will it just clutter up results with junk? I'm sure advertisers would love better demographics info, but it's the user experience that makes web tools succeed or not.. We'll see.

/thinking out loud

I don't have a horse in this race anymore, though. I made about 25% in GOOG in a month and then sold it to buy something more undervalue...

See, I'm a rock climber but I never have to search on Google for anything regarding rock climbing. However, its listed in my FB profile. When a new gym opened up in my neighborhood, I saw an ad from Facebook and clicked on it.

I'm also a Pink Floyd fan but I don't ever search for anything related to Pink Floyd on Google. Don't have a need to. When Roger Waters was playing in my town, I learned about it through an FB ad. I bought tickets by clicking on the link.

In both cases, my intent was latent.

There's a reason why Google is betting the farm on Google+. If they felt it was not monetizable, they wouldn't be diluting their search results with links from Google+ and risking their core business.