Facebook shares as an investment

Discussion in 'Finance, Property, Law' started by bitterandtwisted, Feb 2, 2012.

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  1. Now that FB is due to float. I am contemplating in bungin a few quid in as long term investment. Never done this before.

    Questions are:

    Who would I speak to about it??? (apart from you lot)

    Who do buy them from?? (Yes I know His name is Mark Zuckerberg and share dealers but whose reputable)

    Do you think its a good investment????


    Cheers for any tips/ advice in advance....
     
  2. I would have said not. The investment fund managers who were talking about it on R4 Today certainly weren't going to. it'll be a typical net launch price goes ludicrously high and then tanks spectacularly when everyone realises it was massively over-valued. Lastminute.com all over again.
     
  3. What psychobabble said!

    I think after recent publicity with the film 'The Social Network', the recent developments of the FB system and add-ons will have the owners valuing the business above its actual value and will put share prices pretty high. Social Networks always have a shelf life, look at Myspace and bebo etc they were all a lot bigger at one point but have subsequently shrunk to insignificance.
     
  4. Add to the above, very sensible comments, that with only $5bn issue from what is supposed to be a $100bn market Cap the available shares will have zero real power in the company. The employee to revenue figues really do not add up and whilst it will probably be masively oversubscribed, Private Investors will find it difficult to buy pre-IPO.

    If you really want to buy this or any other US quoted share you will need a $ stockbroking account, google is your best place to start to look for one or you could look at the BARX (Barclays Stockbroking) offering as an example (not a reccomendation, but good platform).
     
  5. Aside from the Facebook question, do the team think there'd be any merit in setting up a sub-forum or thread within the "Finance" forum itself for people to discuss stocks, shares etc? I've had a look for one but can't see anything obvious.

    Fairly understandably it would all have to be caveat-ed with the usual "Information-contained-herein-is-not-financial-advice, consult-an-IFA, and the-value-of-stocks-&-shares-may-go-down-as-well-as-up-and-you-may-not-get-back-the-amount-originally-invested" but that said I do think it would be good to have a shares discussion board.

    Unless of course the Mods say it's a "No-no" due to legal or technical issues.

    Anyone got any thoughts??
     
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  6. It might be useful to have some sort of sticky along the lines of "how to buy and sell shares"; I know quite a lot of people are interested in doing their own trading, and advice about the DIY options available would be helpful.
     
    • Like Like x 1
  7. I've been watching the FB float with interest and definitely wouldn't buy immediately. They will be hugely overvalued to start with. FB is also losing subscribers/users at present and I would expect to see more made of that in terms of negative publicity around the launch.

    I'd give it 8 - 12 months and watch the share price start to tumble. Once it hits 50% of the original IPO price, then I'd be looking at the user base of FB and whether there is a turn around, or what plans FB has to turn it around.

    Then I'd make a decision whether or not to buy....
     
  8. As far as trading goes, I used to use Interactive Investor. I sold everything off about two years ago, so can't comment on current service, but it was blindingly easy to use at the time.
     
  9. OK. Suppose I start two threads - one on HOW to invest, platforms, tools, sources of data and advice, etc, and the other on WHAT to invest in, tips, analysis, market forecasts, etc. Will that do?
     
  10. TheIronDuke

    TheIronDuke LE Book Reviewer

    Ooooh, how to lose friends. For myself a valuation of $100bn is potty. The initial launch will be a Nantucket sleigh ride and will come down to what the big boys do - at the moment they are trying to talk the valuation down of course, while Morgan Stanley are trying to talk it up. There will be killings to be made in the first week or two, so long as you know which side to bet on.

    Longer term I'm not convinced. FB ad revenues are down. Year on year growth halved from the first quarter of 2011 to the last, FB sign-ups are slowing and the internet is a fickle and volatile market as News Corp found out when they got burned with the MySpace deal.

    Just my opinion. I am not an expert so dont take this as advice.
     
  11. Try the Motley Fool share dealing service. They have flat fees for both UK and International trades.
     
  12. I use Barclays, no idea if its the "best", but it came free with the premier account many moons ago.

    As to facebook as an investment? IMHO they are making a mistake by mandating the Timeline interface before the IPO. Losing 10-15% users might dent the valuation significantly.

    And no matter how many times this happens, look at the basics. Facebook is valued at $100billion. Based on what? Not revenues, and not book worth, but 'hysteria'. Think Global Crossing circa 2000, Worldcomm 2001.
     
  13. I think the IPO itself could torpedo Facebook. The firm has already lost its aura of "cool", and its long-delayed income stream - upon which the IPO is valued - comes from the very same advertising that is starting to hack off many users who naively subscribed to the original free/cool/yoof aspects. I reckon it will only take a data privacy scandal, or a fresh new fad, and FB will completely implode....
     
  14. For me I worry about the leadership. Either he's running a company or a social experiment, or more likely he can't make his mind up. For me it's the clincher, it's a high-risk stock pretending its a big corporate. No sale.