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Facebook Stock Will Bottom At...


Marylander
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The people who made money on this stock were the ones who shorted it (bet on it declining). I don't think Facebook stock will do poorly in the short term, but in the long run it may fizzle out.

 

I think low $20's is a realistic price target for the stock.

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Unless Facebook figures out a way to produce larger revenue over the next few years I wouldn't touch this one at all. The return on their stock will never bring in strong numbers for the average Joe.

 

GM has already pulled their FB ads because they don't see any return from them, and I'm sure other majors will follow. This will leave FB struggling to bring in money from somewhere and keep their stock from fizzling. I just hope they don't resort to charging users a fee or selling users information away regardless of your account settings.

Edited by JBlack151
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I agree, Facebook will cut in half in no time. They do not sell any goods or services equal to their claimed value. Amazon, Google, Apple, are all real businesses, selling goods and/or offering services. Facebook is just an app for an iPhone. Nice little gimmick, but not a real business. I don't really go on Facebook, but have never seen advertising.

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The problem they have is that their revenue is based on targeted ads. With more and more people ditching their computers and going mobile, the ads don't show up on mobile. Not to mention how there are apps that get rid of all advertisements. The mobile social revolution they started will eventually be their demise.

 

How low? I don't know, but its not worth anything.

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Anything more than 1 or 2 bucks is way too much, IMHO. Instagram??? Does anyone not remember the tech bubble of the '90's???

This company currently has the same market cap as Intel??? :explode:

 

I agree with this review of FB's stock value but I don't share his future outlook.

How Overvalued Is Facebook Stock? - Seeking Alpha

 

Another good writeup on FB's value:

Lack of trust in Facebook may hold back ad sales

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The stock is currently way over valued, nothing but pure speculators would be buying the stock at these prices, hoping for a quick flip.

 

The stock price at the number of shares is totally ridiculous, there is no reason that FB should have been valued at $100B. They don't have current revenues to support a multiple that large, don't have a strategy to create revenue from mobile (which we all know is where more and more of the FB activity is originating from). For comparison, the company I work for has proven multiple year growth over 10+ years of 20+% a year, with annual rev a little less than $2B this year, and our market valuation is just over $7B. This is a little undervalued but much closer to healthy and sustainable P/E ratios.

 

Morgan Stanley was too desperate to get the FB stock that they allowed FB to convince them to increase the size of the offering and increase the price, way beyond rational numbers. As a result the IPO investors are getting burned and not getting the usual first couple of days bump. The next time Morgan Stanley does an IPO, I assume these investors will be less trusting of Morgan Stanley's evaluation and less apt to be willing to buy in early, thus making these future IPO companyies pay the price for the fool hardy mistakes that FB just cashed in on. Eek!

 

So, I think that a fair market stock price valuation based on FB revenue and strategy would somewhere in the $14-$16 range.

 

:cheers:

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Yep... I was thinking around $22... knew the big start wouldn't last. If I were better at this stuff I'd have bought early and sold high. Oh well... guess thats why my names not Gordon Gecko.

 

Every time I watch these movies, I kick myself in the @$$ for not pursuing a career like that lol

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I just can't imagine buying this stock over any other real, established companies that have a proven track record and solid fundamentals and/or dividends. Zuckerberg and Morgan Stanley sold the ipo at the full hype price; until this company starts making a profit in line with it's valuation, I think stock owners are just going to be waiting and waiting for any return. And I really doubt that will happen anytime soon ... Already the headwinds seem to be gaining strength.

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Don't & don't care..it's not one that I was interested in purchasing nor am following with any interest...but you guys do make some good points about it!:thumbsup: However, I am still kicking myself for listening to my wife and not purchasing Ford stock when it was under $2.00 a share!:explode:

Edited by mjhpadi
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