Facebook preparing an IPO

Masomnia

http://uk.reuters.com/article/2011/06/13/uk-facebook-idUKTRE75C3V120110613

After LinkedIn's price rocketed on it's first day, and I'd guess the same is inevitable for facebook, is social networking the next .com?

Cleaver

I think Facebook has gone past being a flash in the pan and I think it's become part of a lot of people's every day lives, so I think it's here to stay and is worth a lot of money. But $100 billion? Seriously?

I presume most of the money the site makes is through advertising. But just out of interest, who here who is on Facebook has ever clicked an advert they saw on Facebook? For that matter, who ever clicks any advert they see on the internet full stop? I don't get the internet.

nearlynew

Pile of !!!!!! mate.

Stuff is what you want.

Not fluff.

Lokolo

Cleaver wrote: »

I think Facebook has gone past being a flash in the pan and I think it's become part of a lot of people's every day lives, so I think it's here to stay and is worth a lot of money. But $100 billion? Seriously?

I presume most of the money the site makes is through advertising. But just out of interest, who here who is on Facebook has ever clicked an advert they saw on Facebook? For that matter, who ever clicks any advert they see on the internet full stop? I don't get the internet.

Google Ads I do when I search for stuff and you know the adverts at the top of the search, those ones I do. Sponsored links I think they're called.

But those are the only ones...

Cleaver

nearlynew wrote: »

Pile of !!!!!! mate.

Stuff is what you want.

What is your obsession with physical stuff? It's most odd. I like some services and virtual things. Facebook allows me to keep up with my family and friends that don't live near me, so I mainly use it for that and don't consider it a pile of sh*t.

julieq

The big part of facebook value is the web of connections between people and "likes" - it's a goldmine for targetted marketing and market intelligence. That's why facebook likes to open up private data without telling anyone. But you can't quite see it being worth quite so much as the IPO valuation.

DervProf

Cleaver wrote: »

I presume most of the money the site makes is through advertising. But just out of interest, who here who is on Facebook has ever clicked an advert they saw on Facebook? For that matter, who ever clicks any advert they see on the internet full stop? I don't get the internet.

I have asked the same question myself. When I can be bothered to look on FaceBook, I never really notice the ads. I suppose there could be a subliminal effect, but I doubt it.

As far as other ads are concerned, I can't say that I click on them, if I do it is very rarely. The ads must work to some degree, as businesses seem to keep shelling out to put them there.

Really2

Masomnia wrote: »

is social networking the next .com?

Maybe, maybe not.

Unlike the com's they are bringing in good profits and are established and are not just valued on potential.
But I think the value of peoples information is overestimated.

Generali

Really2 wrote: »

Unlike the com's they are bringing in good profits and are established and are not just valued on potential.
But I think the value of peoples information is overestimated.

Well the investor detailed here:

http://www.ft.com/intl/cms/s/0/54495c12-afa9-11df-b45b-00144feabdc0.html#axzz1PCPRSByO

has trebled his money on this valuation.

People putting in money in April 2009 have seen it rise almost 20x! Goldman Sachs put in $1,500,000,000 at a valuation of $50,000,000,000 so don't worry, they'll do ok out of this.

This is 100x what the company is predicted to earn this year. Price looks toppy to me.

chewmylegoff

P/E ratio of 100?

I am out.

Wookster

PE of 100 seems quite excessive, though does Facebook really earn $1BN in profits? (seems somewhat hefty). Was it Warren Buffet who said its often easier to spot an over valued stock than an undervalued one?

Shame that Skype was bought by Microsoft at a turnover multiple of 20 rather than floated at that valuation - that I would definitely have shorted.