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Tom Winnifrith

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  • Facebook Target Price Is $5, But More If Zuckerberg Quits [View article]
    Smose

    Sorry that you feel I am a moron. Your call. If you loved Facebook at $19 then no doubt you love it even more at $18.06. By the time it is $15 you will be in rapture. You are free to ignore my advice, leverage up to the neck and buy FB - it is your call but ... ultimately valuations have to be based not on revenuesbut on cash generated.

    Any fool can but top line growth by sacrificing the bottom line but that is not what will determine investor returns.

    Net cash if the company wound down tomorrow would be c$3.50. But of course we know that it will not. MZ and you appear to think that burning that cash to build the top line is what investors want. I tend to disagree with that analysis.

    Tom
    Sep 3 10:26 PM | Likes Like |Link to Comment
  • Facebook Target Price Is $5, But More If Zuckerberg Quits [View article]
    Rwahlen

    Cripes am I at 44 and a half one of the oder generations already? I suppose I am.

    A technology can change the world but that does not mean that it will make investors money. Look at radio stocks in the 20s or indeed dotcom stocks of 2000. Airlines...

    As you say those who use the site have low disposable incomes. And so they are a poor audience for advertisers who appear to increasingly note the dire returns they get there. Hence my point about lack of earnings visibility.

    If markets were truly efficient Warren Buffett would not exist. The point is that they are not. That is why this share has tanked. And why it will continue to tank. It was priced wrongly (thanks to Wall Street hustling) and is now correcting towards fair value. While it remains overpriced there are far more folks who will sell ( at a vast profit), viz he soon to be unlocked insiders than there are shorts to be covered. What is the current short position as a % of the free float? 10% 20%? The number of shares that could be sold by insiders released Oct-Dec is a MULTIPLE of the total free float.

    As to the Arab spring. Oddly they managed to have revolutions in the ME and elsewhere before the internet. It assisted maters in Egypt but did not cause or enable them.

    Tom Winnifrith
    Sep 3 10:19 PM | Likes Like |Link to Comment
  • Facebook Target Price Is $5, But More If Zuckerberg Quits [View article]
    Brownie61

    Yes that is correct they should. If there is zero earnings visibility you risk overpaying if you adopt another approach. There is no margin of safety ( see Benjamin Graham).

    Your approach is to value stocks on a multiple of hope. I do not regard that as genius. That is the bigger fol theoeory of trading rather than value investing

    Tom Winnifrith
    Sep 3 10:11 PM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    Remurraymd

    Still 8 years left in decade but I agree that FB an early runner and rider in this competition.

    I would add on capitulation, I'd like to see analyst coverage halved before I even considered buying

    Best wishes

    Tom
    Sep 3 05:41 PM | Likes Like |Link to Comment
  • Manchester United: It Takes A Brit To Explain Why America Has Been Fooled [View article]
    Killer Whale

    I am sure that it does qualify technically. But that says more about the daft rules implemented than it does about Man United. Is bringing this sort of company to tthe NYSE really creating jobs or real wealth in the USA? Does it add to the standing of the NYSE?

    I would answer no, no and no. I guess your President Obama might care to explian why I am wrong.

    Tom
    Sep 3 01:44 PM | Likes Like |Link to Comment
  • Manchester United: It Takes A Brit To Explain Why America Has Been Fooled [View article]
    Manutdtillidie

    So unless I support Man United I cannot write about them?

    Oooh "They don't like it up 'em - Corporal Jones, Dad's Army - I am sure you know all about that too.

    Get a grip man. I too will support my club forever but it does not mean I'd buy stock in it. You need to look at these things disapassionately. Not sure you have.

    Best wishes

    Tom Winnifrith
    Sep 3 01:42 PM | Likes Like |Link to Comment
  • Manchester United: It Takes A Brit To Explain Why America Has Been Fooled [View article]
    Martin C

    The view here is that the Glazers would sell their grandmothers for a few cents so I am sure the Old Trafford name-heritage will go fairly soon too. Just wonder in the long run what destroying that link with the past will do for the brand.

    Why not go the whole hog and rename the team MacDonalds United and see what the short term & long term impact on cashflows is?

    Tom Winnifrith
    Sep 3 01:38 PM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    Kenneth12

    And the IE also stresses the importance of historic earnings as opposed to projections since the former might just be true, the latter ( especially when there is no track record) rarely are.

    Those who have not read the IE and who consider buying FB should get hold of the 2001 edition with the Jason Zweig notes as they are particularly apposite to this situation.

    Thank you for your comment

    Tom Winnifrith
    Sep 3 10:52 AM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    Bob

    Well so far any folk who have held/bought on the basis that the stock might be worth $38 have lost a packet while those who sold/went short on the basis that the stock might be worth $5 have saved themselves a packet/made a packet.

    Morally my stance is equivalent to that of MZ. It is just that factually so far I have been right and he has been wrong.

    You are not compelled to listen to me. You can follow MZ and leverage up to the hilt buying FB stock if you wish. That is your call. It is a ( sort of) free country. But, as your friend, I would caution against it.

    Best wishes

    Tom Winnifrith
    Sep 3 10:50 AM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    CPEisen

    1.71 billion unlocked Oct -Dec to be precise. Free float will have increased by 274% between day one after IPO and Christmas. The chances of even some of that stock being abosrbed without crashing the share price are slimmer than my chances of getting a hot double date with Miss Ireland 2011 and 2012. ie. nil.

    Tom Winnifrith

    NB If Miss Ireland 2011 & 2012 happen to be reading this I am free Wednesday night after 6.
    Sep 3 10:46 AM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    Steveto

    Suggest you send your ideas and CV to facebook Non Execs.

    If they are not too busy selling FB stock they might find it handy when looking for the next CEO in a few months time.

    Best wishes

    Tom Winnifrith

    (NB This is what the British call humour, before some of the more po faced FB bulls here suggest that this is not how respectable fiolk write.)
    Sep 3 10:41 AM | Likes Like |Link to Comment
  • Facebook Analyst Downgrades: Do We Care? Are Any Analysts Now Credible? [View article]
    Truffelpig

    I am not sure that I have ever disagreed with a post more.

    There are only bears left? Well 19 of 35 analysts rate the stock a buy & 15 a hold. Some of the critics of my postings are also bulls. So not sure we are at capitulation yet.

    As for sellers - well the 1.71bn lockin shares ( most bought for just cents) are nearly all obvious sellers. And that number dwarfs the current free float.

    So there are plenty of sellers out there.

    After next earnings go up? What evidence do we have that this will be the case? Those analyst downgrades make me think earnings are not going up, certainly not fast enough to justify current PE ( still over 50).

    The company is growing fast? Sure it has more users but it is free cashflow generation that counts.

    Cheaper than Amazon etc? We do not know as we have no idea on earnings. I am not sure I'd rush to buy AMZN either but certainly we cannot say FB is cheaper until we have some idea of future earmings which we do not.

    Sorry...

    Tom
    Sep 2 06:03 PM | Likes Like |Link to Comment
  • Facebook Target Price Is $5, But More If Zuckerberg Quits [View article]
    SMJTRust

    1. Do you have any evidence that earnings are increasing other than analysts forecasts. I think the 2012 QonQ sequence may rather cause you to question that.

    2. Since no-one can forecast earnings at all I am not sure that you can say with any certainty at all that the stock will not hit $5 but may hit $40.

    I think all the evidence is that FB earnings are really now starting to be hit by ad scandals. If they are ( at best flat) then you will get a chance to buy on the dip at close to $5 sooner than you think.

    Tom Winnifrith
    Sep 2 04:09 PM | Likes Like |Link to Comment
  • Facebook Target Price Is $5, But More If Zuckerberg Quits [View article]
    Padresguy

    I think linking FB to other tech stocks in terms of rating is a dangerous game becuase a) its short time as a PLC and b) the utter lack of visibility on earnings growth it offers compared to the field. In a few years time maybe but now now.

    Besides which every company is different. It is always apples and oranges. Valuations must be pegged on proven cashflows. But with FB so little is proven. Thank you for your feedback.

    Tom Winnifrith
    Sep 2 04:05 PM | Likes Like |Link to Comment
  • Manchester United: It Takes A Brit To Explain Why America Has Been Fooled [View article]
    Chriswl

    I think you make my point on fans quite well. There is a hard core. But then who the young folks in the UK starting to like soccer and the new audiences in Asia root for is success driven. So 20-30 years ago Bill Shankley ( "football is ot a matter of life and death...it is more important than that) and Bob Paisley brought those reds a whole swathe of new fans. Who will the "new" fans support over the next ten years. For Man U to grow revenues as the club expects it has to be Man U. But if Chelski and City win all the silverware?

    As an aside I see that United sold Berbatob this week to Fulham for £4m. They paid £30m a few seasons ago. But at least that is the wage bill trimmed. Can anyone explian to me how an enterprise that does business in this way can be taken seriously as an investment case?

    Tom Winnifrith

    PS I see that Man United managed to scrape home 3-2 today against bottom of the league (lost all 3 games to date Southampton) and are now 6th ( only ahead of my beloved West Ham on goal difference). Two one goal wins ( the other being vs Fulham who West Ham thrashed on Saturday) and a defeat to Everton is not exactly a flying start to the campaign. Man City now 4th, Chelski top & unbeaten.
    Sep 2 04:00 PM | Likes Like |Link to Comment
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