

FB nearly cut in half since IPO (22.28 current low) - veyron
http://www.google.com/finance?q=FB

======
macspoofing
I have very little sympathy for those people that lost money on this stock.
For months, there were articles about the overvaluation of FB ($100 billion
number was thrown around quite often). Here in the office, we had discussions
around that, and though everyone agreed FB is a valuable company, 100$ billion
was an insane number, considering their revenues were more or less public for
a while. And then the IPO happened, at 100$ billion and ... they dropped.

So, where's the surprise?!

~~~
ryguytilidie
And the crazy thing is that you certainly don't buy stock if you dont expect
the value to rise. Did these people really think that we would decide fb is
REALLY worth 200b they were going to 2x their investment? The opinions were
either: way too high or ehhh, I guess it could be right. That doesn't make me
feel like a stock is undervalued and I will make money from it. No idea what
these people were doing beyond buying a ticket on the hype rollercoaster.

------
steveplace
If anyone actually is interested in a trade here...

The option market was pricing in about a 12% move. Today we got a 15% down-
move. This means that anyone who was short puts either has to cover or they
have to sell stock to reduce risk.

Normally what happens after earnings events is that the implied volatility
gets crushed as the event risk goes away. However because the options market
is feeling a bit of a squeeze, the IV remains elevated... this was the case
this morning, but less so right now.

So the trade? If you want to buy the dip, I would look at cash-secured put
sales. Specifically the Sep 21 put sale for about $1 or higher.

If fb heads under 21 bucks then you will be assigned with a basis in the 20s.
From there you can roll to covered calls or just hold onto the stock at these
levels.

Put sales make sense if you are bullish stock and bearish volatility, and as
IV continues to fall as the event risk goes away, your position will be in an
advantage.

~~~
tatsuke95
No offense, but most of us here probably have no idea what you're talking
about.

I appreciate you taking the time to offer advice, I only wish I could follow
it.

~~~
steveplace
Hey no worries.

This is my kind of "hacking" so I thought I'd put it out there.

~~~
achal
I'm actually rather interested in what many of those fancy words mean. I'll
end up searching around, but beyond that, are there any decent resources you
would recommend for someone with only a basic understanding of the market?

~~~
veyron
I compiled a short list a long time ago:

<http://news.ycombinator.com/item?id=3178313>

The hull book Is probably the best for what you want.

~~~
achal
Thanks!

------
tonetheman
I think it is just making its way towards a more realistic number. FB makes
money and they are not a bad company, the stock was just way too high.

~~~
samstave
So whose fault is it exactly that priced this so poorly?

Personally, I think this was a fraudulent deal by GS/Morgan Stanley -- Given
all the criminality in banking thats been painfully obvious for years - I
think this was a deliberate over valuation to allow them to dump shares
immediately make a ton and let the stock drop.

Knowing that even though they did this, Facebook was not going to go under or
have their actual business affected.

I can't believe that there is not a hell of a lot of WTF thoughts and anger on
the inside of FB at this. Does anyone know the sentiment of FB employees over
all this, especially employees who have a sizable amount of stock?

~~~
tatsuke95
> _"Personally, I think this was a fraudulent deal by GS/Morgan Stanley --
> Given all the criminality in banking thats been painfully obvious for
> years"_

Please point me to a link that shows all of the banks and employees that have
been charged with crimes.

> _"I think this was a deliberate over valuation to allow them to dump shares
> immediately make a ton and let the stock drop."_

A stock trade is a two way transaction. A holder of shares doesn't get to just
"dump" stocks; someone has to be on the other end of the deal. For every
_seller_ there is a _buyer_. Why would they want the stock to drop, rather
than have it go through the roof, allowing them to cash in at a higher price?
That makes no sense.

> _"Knowing that even though they did this, Facebook was not going to go under
> or have their actual business affected."_

Have you stopped to consider that _Facebook's business model_ is the real
problem here? Probably not. It's far easier to go along with the anti-bank
populist sentiment.

> _"Does anyone know the sentiment of FB employees over all this, especially
> employees who have a sizable amount of stock?"_

If they are to be angered at anyone, it should be at the Facebook _insiders_
who dumped their stock.

~~~
ryguytilidie
"Personally, I think this was a fraudulent deal by GS/Morgan Stanley -- Given
all the criminality in banking thats been painfully obvious for years"

Please point me to a link that shows all of the banks and employees that have
been charged with crimes.

I hope you don't actually think that the lack of being charged with crimes
means no crimes were committed. This is an awful line of logic.

~~~
tatsuke95
> _"I hope you don't actually think that the lack of being charged with crimes
> means no crimes were committed."_

For the most part, yes, I do. I believe the justice system works.

You don't think there are politicians out there just _itching_ to perp-walk
some of these bankers? That there aren't some hot-shot DAs dying to make a
name for themselves? It happened with Enron, Worldcom, Tyco. The public is
frothing at the mouth to put some of these guys on trial.

So why haven't they? Because, like it or not, there hasn't been as much legal
malfeasance as some would like to believe. Sure, if you look hard enough
you'll find rogue employees doing bad things. That's a fact, and I won't deny
it. You'll find the same in _any_ large institution, be it government or
Google. But this idea that the banks are directed from the top down to defraud
people on a mass scale is complete and utter nonsense. Sorry.

We, as the public, like to create a narrative for why these massive
deleveragings happen every so often. The reality is these cycles occur
naturally when credit overextends. Suddenly we start blaming the bankers for
people taking out loans they can't afford to pay back.

The banks and bankers have been taking an absolute beating for years now. The
US essentially legalized the concept of buying a house and heads-I-win-tails-
the-bank-loses. They've been forced to shoulder massive loan write-offs,
simply because people refuse to pay back money they agreed to via _contract_.
Every media outlet on the planet demonizes them. Stop and ask yourself: when
has the mass media been right about anything?

Oh well. It can only go on for so long. Banks act as the bellwether for the
economy; until they're making money again and lending resumes the economy will
stay in the doldrums. You don't promote wealth creation and economic growth by
stiffing creditors and putting the owners of capital in jail.

------
Smrchy
Buy on bad news it says. Every time i see such a huge drop for the FB stock i
think to myself: Should i buy now - i never did. And every time i see the next
rock bottom i am glad i didn't.

I do believe though that FB has the potential for a lot more revenue just
because they own the channel to their gazillion users. They just haven't
figured out a good way, yet.

~~~
tomgallard
They may say buy on bad news, but following that philosophy might have lead
you to buy Enron and any number of companies where the bad news wasn't just
temporary but a sign of real underlying problems.

You're also falling prey to anchoring bias. Because Facebook stock has
previously been twice as much as it is now, it seems 'cheap', and a good deal.

What you really need to consider is the net value of Facebook as a company (by
assessing its long term money making potential), and deciding whether its
currently under or over valued.

I personally would never consider buying shares in FB because of the weird
voting structure/rights. When I buy a piece of the company I want the
corresponding votes to have my say in making sure that company is run in my
best long term interests.

~~~
Jare
If you're not buying a significant share and are 'just investing' in a
company's potential, you should actually feel more confident knowing that the
company is firmly steered by the hands that created it and made it successful.

~~~
tomgallard
But I want to be able to make that decision. There's nothing stopping me from
re-electing Zuck as CEO every year and letting him do his thing.

However, if he starts doing crazy things, or I think there's a better
candidate for the job, I want to be able to vote to chuck him out. 1 share 1
vote!

------
eduardordm
Don't be fooled by P/E. P=>future E=>past

Current price reflects the market believes that, somehow, FB will find more
revenue streams (not only ads).

I see FB stable at 24$ for at least a quarter.

If you need VC money, you just missed the last train.

~~~
veyron
"If you need VC money, you just missed the last train."

That's not true if you have a business that can sustain itself for a few
years. There's a ton of VC money still there (the stock market, real estate,
bonds etc aren't as appealing as one would imagine) but it's most likely going
to be very picky.

~~~
eduardordm
If you already have a business that can sustain itself for a few years, it's
unlikely you need any VC money at all.

~~~
veyron
github, for example. Owners wanted a large equity event, and they wanted money
for a larger expansion.

------
raldi
What day are the employees allowed to sell? (Their shares are frozen for a
certain amount of time.)

~~~
ashbrahma
Sometime in August.

~~~
raldi
Citation?

~~~
yanowitz
[http://blogs.marketwatch.com/thetell/2012/05/17/facebook-
sho...](http://blogs.marketwatch.com/thetell/2012/05/17/facebook-shortens-
lock-up-period-for-some-holders/)

Unusually short lockup period.

------
nekojima
This posting is a great advertisement for Google Finance. I hadn't realized it
had been improved so much. I may well move over from other sites and begin
using it more often now.

~~~
alexpenny
I haven't noticed any big changes the last five years I've been using it.
Other than the whole google facelift its been the best finance tool I've used.
Maybe I haven't noticed any new features but what would you be talking about?

~~~
nekojima
Its been a few years since I last checked, but having 'real-time' quotes is
better than 15-minute delayed, which I seem to remember it was before. As well
as the graphical overlay of the news bulletins on the share ticker graph is
good too. Just seems to provide more timely information now, including
overseas listings, than it did before. Won't replace my primary broker site,
but good if I don't want to login to check a price or two.

~~~
pyre
Not all of it is real-time:
<http://www.google.com/intl/en/googlefinance/disclaimer/>

Even then, they have a disclaimer:

    
    
      Real-time price data represents trades which execute on
      the NASDAQ and NYSE exchanges. Volume information, as
      well as price data for trades that don’t execute on
      those exchanges, are consolidated and delayed by 15
      minutes (NASDAQ), 20 minutes (NYSE).

------
stillBroke
I too feel victim to the Facebook IPO. My attempt to recoup the loses was
through an iPhone app called "Facebroke". Apple rejected it in less than 1
hour stating "We found that your app contains content that is defamatory or
offensive that would be considered objectionable by many audiences". I had to
settle with a much tamer version of the app. <http://bit.ly/MPNrlo>

------
sulife
$7 stock. Their growth was less than google's %-wise, and google does what...
25X the revenue? Fundamentals say $7ish.

~~~
cluda01
Pardon my ignorance, but how did you come up with this $7 figure? Was there
some technical calculation you made or more of a gut instinct?

------
rjtavares
I can't help but think this is an overreaction to the Zynga implosion. Feeling
the urge to buy...

~~~
joering2
Why? Goog PE is 18. Aapl 13. Facebook... 122. 10-times fold!!

Don't get me wrong: Facebook is making profits, but the majority of
stockholders will keep on looking at PE. Until it remains in such absurd
range, you will keep on seeing it in red.

This stock belongs in less than 10 dollars space. Then when its get there at
$6, buy it for a +$2 pop.

~~~
jonknee
That P/E is especially worrying because of the scale FB already works in. They
just don't have all that many people left to grow with, especially people that
are in any way attractive to advertisers. The growth is going to have to be
with better monitizing their existing users while trying to keep down
expenses, not typical for a very high P/E company.

