Facebook IPO

Morgan Stanley is underwriting the FB IPO.

 

There's no scam, its so easy, you don't want any? Don't buy.

 

Now THIS, I 100% agree with.

People always celebrate when an IPO jumps some big percentage on the first day. (theglobe.com was a memorable one.)

But, I'd be pissed if I was one of the company founders/investors. it means you didn't accurately price the company, and I didn't get market value for the shares we sold to the public.

It means the underwriter was more interested in rewarding their top investors than it was in getting me full value.

(Now, in practical terms, they're not that pissed, because as Stitch points out, they usually only sell of a small percentage of the company, and the remaining shares they hold are valued at the marked price.)

 

Facebook throwing some money around:

 

Price target set between $28 and $35 per share, which would raise approximately $11 billion. Undervalued?

http://dealbook.nytimes.com/2012/05/03/facebook-to-set-target-after-market-close/?ref=technology

 

It'll pop to least $100 its first day. So, hell yes.

 

There's no shame in riding a bubble if/while you can. There are so many "grannies and 12-year-olds" who plan to sink unrealistic and, frankly, dangerous amounts of their savings into this stock that I can't see any way it doesn't bounce and do quite well for a time. There's just a lot of people out there who are really gonzo on this stock. When was the last time an IPO generated this level of excitement?

Also, when the company inevitably breaks up some day, the data they're sitting on is going to be worth an incredible amount of money. They own literally everything anyone has ever written/posted on there, and the specificity and depth of what they know about hundreds of millions of people is worth an obscene amount of money. There's value there, as well as in all the enterprise technology, etc.

One thing I always try to remind myself is that it is human nature to want to be the one who predicts a downfall. I forget where I read an article about this behavior this year, but basically human investors act irrationally by focusing more time and attention on trying to time the top of the market or the peak of certain popular stocks, when they'd be better served by just focusing on buying good stocks and counting on appreciation.

My case in point on that is gold. How many freaking years have I been waiting for that to come back down to earth? It's kind of bizarre to think that people who developed 100% of their investment strategy by watching G Gordon Liddy infomercials have done as well as anybody the last few years.

 

Anyone know the first day for trading?

 

May 18th

see:

http://www.globalpost.com/dispatch/news/business/120502/facebook-ipo-date-set-may-18


(Edited to add URL for the Global Post link)

 

I won't be buying into this...mainly because I am not a big fish. My financial advisor said to me that unless I'm willing to sink everything I have into this, I won't get a sniff. Even that amount won't be enough to get me a seat at the table. The demand-supply ratio of this is about 4-to-1, going to be hard for John Qs to get a piece of the pie.

 

A former neighbor of mine thinks he has a shot at the IPO price.

 

The market is so hot for Facebook right now, so people who already bought in the secondary market appear to already be underwater if the IPO is valued at $90B. This has all the signs of a huge fail (longterm.)