Facebook announcement- Will make a Facebook phone in 2013

[TheForce]

We have FaceBook. Next we'll have the FACEFONE™ No need to play the above games like you all do with other tablet names. Zuckerberg already uses FaceFone as the code name for this secret project. But he made one mistake- there are no secrets in Facebook world!

 

[Peter Parker]

I dont get this thread. Zuckerberg said there will NOT be such a phone. Is this an August Fools thread?

 

[TheForce]

I think the source stated on CNBC was from htc. htc is doing the hardware, Facebook working on the OS. I also think the location for the development of the OS is in London, not the US. Since I have no interest in the stock at this time I didn't pay really close attention to the details. If there is such a phone, I doubt it will be successful. FB really needs to focus on their advertising model. Until they get that working, FB is doomed. It's still trading at over 110 times earnings. To get reasonable the stock needs to trade at $4-$6 a share.

 

[meStevo]

Stock is doomed, FB will be fine.

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[dangue]

Stock is doomed, FB will be fine.

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If Facebook will be fine, then the stock can't be doomed. Or do you mean to say that it'll be fine, but never recover to initial values, so the people that bought it at $38 are doomed?

 

[meStevo]

Their stock can go to hell, they can even be delisted, but that doesn't mean the company is in shambles and isn't still making $1b/quarter in ad and other revenue.

 

[dangue]

Their stock can go to hell, they can even be delisted, but that doesn't mean the company is in shambles and isn't still making $1b/quarter in ad and other revenue.

Since stock price is tied to a company's performance and revenue, it's doubtful that a company making $1B in revenue every three months would end up delisted.

 

[TNGTony]

Stock price (of any company) is tied to NOTHING other than the demand for said stock and the price investors are willing to pay for it. Generally investors buy stock that will give them the best return on investment, not because it's tied to "the best" or "most innovative" and in some cases even most profitable company. Stock prices go up and down on the whims of the investor mob-mentality.

Now you can help drive that demand by company performance, but if the public has a certain momentum, it is very difficult to turn it around no matter what the company does. If the company is relying on the capital the stock purchase will bring, that is the only time the company can be in trouble.

 

[dangue]

Stock price (of any company) is tied to NOTHING other than the demand for said stock and the price investors are willing to pay for it. Generally investors buy stock that will give them the best return on investment, not because it's tied to "the best" or "most innovative" and in some cases even most profitable company. Stock prices go up and down on the whims of the investor mob-mentality.

Now you can help drive that demand by company performance, but if the public has a certain momentum, it is very difficult to turn it around no matter what the company does. If the company is relying on the capital the stock purchase will bring, that is the only time the company can be in trouble.

Yes, many many things affect stock price including public sentiment and the overall economy. But my point was that a profitable company will always have some value. Unless the 4B in annual revenue does not create any sort of profitability, it's very hard to imagine a situation where Facebook would face delisting. Mob mentality will only go so far before P/E gets into the acceptable range and disciplined investors will find value in the stock at that lowered price point. There are exceptions to this, but I don't think they're worth bringing up in this instance.

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[TheForce]

Dangue, Tony- There are two types of people who buy and sell stock. Traders and investors. Traders are mainly concerned about the change in stock over a short period of time and will try to turn a profit even if the company is broken ( meaning the business model doesn't work) There is also the investor who is primarily concerned that the company has a viable business model as the investor wants a company to grow over the long term so the investor's net worth will grow. You could also say there is another type of investing where the buyer and seller of the stock trades around a core position. For example- buy and sell 20% of your holdings in hopes of increasing the 80% numbers quantity but not the %. That is a hybrid of the above two.

it's very hard to imagine a situation where Facebook would face delisting.

There is nothing to imagine here. It's a regulation. I forget the details but there are examples. My most recent recollection was the of delisting for Blockbuster before Dish Network purchased the company out of bankruptcy. If a stock trades below a certain price for too many months, it will be delisted and will be then traded in the OTC as a penny stock. Another that came close was Sirius XM radio.

 

[dangue]

Dangue, Tony- There are two types of people who buy and sell stock. Traders and investors. Traders are mainly concerned about the change in stock over a short period of time and will try to turn a profit even if the company is broken ( meaning the business model doesn't work) There is also the investor who is primarily concerned that the company has a viable business model as the investor wants a company to grow over the long term so the investor's net worth will grow. You could also say there is another type of investing where the buyer and seller of the stock trades around a core position. For example- buy and sell 20% of your holdings in hopes of increasing the 80% numbers quantity but not the %. That is a hybrid of the above two.
There is nothing to imagine here. It's a regulation. I forget the details but there are examples. My most recent recollection was the of delisting for Blockbuster before Dish Network purchased the company out of bankruptcy. If a stock trades below a certain price for too many months, it will be delisted and will be then traded in the OTC as a penny stock. Another that came close was Sirius XM radio.

Yes, I believe it's sub $1 for 30 business days or not meeting the minimum market cap requirement. Again, I will reiterate that it is hard to imagine a company with the hypothetical revenue of $4B ever facing delisting.

 

[Peter Parker]

What would be hard to imagine is a company with that kind of revenue not being able to keep it's share price above $. Remember they could even do a revers split to get there. Delisting is a theoretical possibity for any stock but while Facebook was overvalued at $38 a share $1 per share is even more ridiculous----though I have to admit this stock is testing its lower limits.



And I still don't believe the Facebook phone rumors especially after the Zuckerberg disclaimer but people sure do like to specualte about it.

 

[Peter Parker]

I think the source stated on CNBC was from htc. htc is doing the hardware, Facebook working on the OS. I also think the location for the development of the OS is in London, not the US. Since I have no interest in the stock at this time I didn't pay really close attention to the details. If there is such a phone, I doubt it will be successful. FB really needs to focus on their advertising model. Until they get that working, FB is doomed. It's still trading at over 110 times earnings. To get reasonable the stock needs to trade at $4-$6 a share.

The earnings are about $.29 a share. 110 times earnings would be a share price of $31.90. This stock has not been that high since mid July. It has fallen significantly and it has further to fall. Not sure $ to $6 is right but it has further to fall.

 

[TheForce]

I haven't really looked at it since mid July, Geronimo but on Ameritrade stats for FB the EPS is not .29 per share but .12 The PE Multiple is listed at 122.37 This should equate to a stock price of 14.64 If it's higher than that, which it is, it means the market is overpaying still. ??? Being an engineer stock math is so fuzzy to me.

This from Ameritrade:

When FB reported 2nd quarter 2012 earnings of $0.12 per share, it met the consensus estimate of the 31 analysts covering the company.

The analyst's estimates ranged from a high of $0.29 to a low of $0.09, with a median estimate of $0.11.

FB is expected to announce 3rd quarter earnings the week of October 25, 2012.

I see where you got the .29 from.

 

[Peter Parker]

I am getting .29 at other sites. that is listed as prior period earnings. Analyst estimates are, do doubt, going to vary widely on this one. the lack of any real track record as a public company alone will cause that.


Butas itt urn out I was astill incorrect. . Facebook has reported earnings as a public company----last week in fact and they were .12 a share for the period meaning that the $.29 is old news.

 

[TheForce]

It's really funny ( in a irresponsible sort of way) that the news hyped FB so much in favor of a very high stock price while they did the same thing in a negative hype with Netflix. Netflix is still being hammered in the press driving the stock down more. I heard one reporter on FoxB just last week remind viewers that Netflix raised their prices causing a mass exodus of subscribers. That was a year ago and the news is still hammering on it. After a couple years they now have given BP a break on hammering their stock. It's not just FOXB either it's all of them! Mark Zukerberg must be the little darling of the press I guess.

 

[Peter Parker]

That has always been the ase. it seems like ancient history now but DISH stock and Charley Ergen were once the darlings of Wall Street. That stock rode a wave that was at times totally irrational for some tjime. But of course it did come down to Earth.