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proffowler123

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  • Facebook wins approval from California to issue stock for its purchase of Instagram. The deal - made up of $300M cash and nearly 23M FB shares - is valued at about $730M now vs. roughly $1B when announced in April. "(I) realize there's upside and downside to all public markets," says Instagram founder Kevin Systrom. "We still firmly believe in the long-term value of Facebook." [View news story]
    I've not read the Security Purchase Agreement, anyone know about the lockup restrictions? This will be an interesting one too! Maybe another "Mr. Thiel"?
    Aug 29 04:34 PM | Likes Like |Link to Comment
  • Needham wades into the carnage that has been Facebook's (FB) IPO and initiates coverage with a buy rating and a price target of $40 a share vs. yesterday's close of $31. "With over 900M monthly users, we believe Facebook is an option on the World" is the cheese-filled explanation. Facebook is enjoying a bit of a bounce premarket and is +2%.  [View news story]
    It is only an opinion, but retail investors need to be aware that underwriters may be buying at this point to provide another floor/support level. They then begin create another market, only to sell when it reachs, say $38.00 again.

    NASDAQ is still having problems, they only true access is through the big investment houses, so these trades are being supported buy/sell inside the underwriters.
    May 23 09:49 AM | Likes Like |Link to Comment
  • The SEC and Finra look set to launch separate investigations of the Facebook IPO. Finra Chief Rick Ketchum calls allegations analysts for the lead underwriters leaked negative views about FB to select clients ahead of the IPO, "a matter of regulatory concern."  [View news story]
    Not exercising your Friends & Family shares because of insider information is just as bad as buying/selling current publicly traded stock under the same circumstances. I am sure that Finra and SEC will want to see the list of insiders and compare it against who traded and who didn't trade. This is going to get really messy!

    May 22 03:01 PM | Likes Like |Link to Comment
  • 4 Reasons To Stay Clear Of Facebook: Part 1 [View article]
    We also need to keep in mind that the underwriters will now let this fall as much as possible. They will then begin to buy at the lower price, establishing another market run. Retail will not be ready for what is happening and believe that "now is the time to buy". Irrational exuberance will take over again, the underwriters will make up for their losses and retail investors (day traders) will be stuck with the same "worthless" stock. I use the work worthless loosely speaking.
    May 22 02:52 PM | Likes Like |Link to Comment
  • It's happening again. Facebook (FB -7%) dives in early trading to $31.65 - shares are now down 17% from their $38 IPO price, though the company's multiples are still high. If Facebook doesn't soon reverse course, class-action suits over last week's increase in its offering price may just be a matter of time. (also)  [View news story]
    Ryche, I would guess that many of the retail buyers did not even look at the prospectsus, read any financials or even do any analysis. They bought on the name FACEBOOK. As Mr. Greenspan back in 1996 - "irrational exuberance"!

    The "trade" had nothing to do with numbers/analysis, it had to do with the intangible name FACEBOOK. Hence way Beta does not necessarally work all the time, but we are "seeking Alpha" what is that factor that quantifies this process (sorry it is the professor in me)

    They can sue and I am sure that there is are class actions beginning to form in discussion (that is the CFO in me). Just like Vonage, they will find something to latch on too. I would say that just the Instagram announcement/deal during the quiet period plus the announcement about hiring engineers to focus on mobile would be enough for a basis of complaint. With the cash in the bank, a settlement would be the most likely scenario, just like in Vonage case.

    I am not an attorney, nor did I buy shares, these are just general observations (this is the Red Herring in me, don't take what I say as anything but general discussion points, not worth a thing)! I am a GURU (Generally understanding, Relatively Useless). HAHA
    May 22 10:46 AM | Likes Like |Link to Comment
  • It's happening again. Facebook (FB -7%) dives in early trading to $31.65 - shares are now down 17% from their $38 IPO price, though the company's multiples are still high. If Facebook doesn't soon reverse course, class-action suits over last week's increase in its offering price may just be a matter of time. (also)  [View news story]
    With what is happening know, it appears that the underwriters have stepped away.

    I am guessing that trades now will consist of underwriters dumping their shares to retail and will then by them back when the stock is low enought to purchase and then run it up again. They need to make up for the losses and the only way to do it is through the retail route. I predict that this will continue to sink until the it is low enough for for MS (and all the 33+- other banks) to begin to buy back creating another artificial market for retail to get pulled into thinking there is a bull in the area!
    May 22 10:13 AM | Likes Like |Link to Comment
  • It's happening again. Facebook (FB -7%) dives in early trading to $31.65 - shares are now down 17% from their $38 IPO price, though the company's multiples are still high. If Facebook doesn't soon reverse course, class-action suits over last week's increase in its offering price may just be a matter of time. (also)  [View news story]
    Additional Information on Morgan Stanley Average First Day Returns:

    According to Renaissance Capital (IPO Tracker):

    http://bit.ly/MDwgns

    Morgan Stanley:

    Number of IPOs:27
    Total Proceeds Raised:$23,814.4 mm
    Average Return:5.1%
    Average First Day Return:15.4%
    May 22 10:06 AM | Likes Like |Link to Comment
  • 4 Reasons To Stay Clear Of Facebook: Part 1 [View article]
    According to Renaissance Capital (IPO Tracker):

    http://bit.ly/MDwgns

    Morgan Stanley:

    Number of IPOs:27
    Total Proceeds Raised:$23,814.4 mm
    Average Return:5.1%
    Average First Day Return:15.4%

    With an average 15.4% first day return, the successful IPO for them would have been a close at $43.852. OR they should have priced it at $32.93 and the POP would have been to $38.00 (as in no money was left on the table. This is an average. I am sure that they were (inside) looking for a 25% to 50% or more POP.

    You might even go as far as saying that the 32.93 (or $33 see low for yesterday) was too high, as MS, JPM (et.al the Syndicate) are still supporting the market.

    Morgan Stanley "lost" on the deal in more ways than one. The stock is trading below their underwriters discount and they are not selling the over-allotment, the first day returns were $0.23 and they had to initially fund the purchase of ALL the shares to distribute to the book of underwriters
    May 22 09:53 AM | Likes Like |Link to Comment
  • Facebook Shorts Were The No-Brainer [View article]
    http://bit.ly/MDwgns
    May 22 09:47 AM | Likes Like |Link to Comment
  • Facebook Shorts Were The No-Brainer [View article]
    According to Renaissance Capital (IPO Tracker):

    http://bit.ly/MDwgns

    Morgan Stanley:

    Number of IPOs:27
    Total Proceeds Raised:$23,814.4 mm
    Average Return:5.1%
    Average First Day Return:15.4%

    With an average 15.4% first day return, the successful IPO for them would have been a close at $43.852. OR they should have priced it at $32.93 and the POP would have been to $38.00 (as in no money was left on the table. This is an average. I am sure that they were (inside) looking for a 25% to 50% or more POP.

    You might even go as far as saying that the 32.93 (or $33 see low for yesterday) was too high, as MS, JPM (et.al the Syndicate) are still supporting the market.

    Morgan Stanley "lost" on the deal in more ways than one. The stock is trading below their underwriters discount and they are not selling the over-allotment, the first day returns were $0.23 and they had to initially fund the purchase of ALL the shares to distribute to the book of underwriters.
    May 22 09:46 AM | Likes Like |Link to Comment
  • 4 Reasons To Stay Clear Of Facebook: Part 1 [View article]
    It would be interesting to know how many "friends and family" pulled out of the deal at the last minute? Hum, isn't there something against trading when one has knowledge that is not "general knowledge"? There well may be more investigations. . . .
    May 22 09:17 AM | Likes Like |Link to Comment
  • Henry Blodget sets a target range of $16-$24 for Facebook (FB -11%), based on a valuation of 20x-30x a 2013 EPS estimate of $0.80. Blodget's retort to those bullish due to Facebook's growth potential: Facebook has already been working on monetization for years; Mark Zuckerberg cares more about Facebook's "social mission" than its business; and the company's next billion users, weighted towards emerging markets, will be much less valuable than its first billion. (previous)  [View news story]
    youngman, that is why he sold the additional 60.0m shares so that he could cover his tax liability!
    May 21 06:15 PM | 2 Likes Like |Link to Comment
  • Facebook Shorts Were The No-Brainer [View article]
    Good point! I hope we do not start to see signs of an MS and JPM (et.al) bailout. Think about it, 33+- banks are involved in this deal. It was a firm commitment, these 33 banks own[ed] the shares they cannot dump and the ones the do will be (potentially) at a loss. Will this be another "too big to fail" situation. This could have far reaching ramifications.
    May 21 05:40 PM | 1 Like Like |Link to Comment
  • 4 Reasons To Stay Clear Of Facebook: Part 1 [View article]
    Underwriters/Syndicate are using the discount spread that they received from the offering price to buy and sell. The underwriter discounts plus the fees will allow them to buy and sell for the next few days. Once the funding runs out, the true market will take over. Can you imagine being in the "friends and family" anticipating a POP of 25% on your initial investment only to see it drop?
    May 21 05:31 PM | Likes Like |Link to Comment
  • Facebook Shorts Were The No-Brainer [View article]
    Don't give up now! The ride down will be just as fun as the ride up (to the IPO, not the stock). Facebook really does serve a purpose, it proves that the market does in fact work, that sometime the "friends and family" do not always win and that insider's risks (except the early investors) are as high as the outsiders. Can you imagine being Morgan Stanley and J.P. Mogan trying to minimize their losses at this point! They are having to use the underwriter spread to cover the sales. Once said and done, how much money will they have lost on this IPO? This is only the beginning of analysis, outside the "valuation".
    May 21 05:23 PM | Likes Like |Link to Comment
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