Facebook - any buyers?

Now that Facebook is under $20; did anybody buy it?

Wouldn't touch it. I've been following it since it IPO'd and I thought it would drop, I never thought it would go below 20 bucks I thought the slide would end mid upper 20's. With the exception of yelp who is a big gainer today, social media stocks have been getting hit pretty bad. Zynga can be had for a couple bucks now.

Anyway, what I was going to say when FB came up was I read an interesting article the other day and some people in the financial circle have coined the term of getting "Zucked" in reference to some of the social media billionaires/multi-millionaires whose paper fortunes have been cut severely since falling out of favor with investors. Poor old Zuck is now only worth a paltry 10.8B after getting a 40% haircut since IPO( actually shave a few more duckets off after today).

J

Social media is always trumped by the next big social media - remember My Space?

The problem with FB is that it's business model is based on ad revenue & the feeling is that not many people who are on FB are noticing the ads

I've been short at $25.50 with a buy stop at 22.50. That should do the trick!

I dont buy any stocks that revolve around an internet adverstising model. I dont understand what drives prices and I dont have the first clue how to forecast the cycle. Some people do. More power to them.

So the people who created Facebook, and those who invested in it as a fledgling company made all the bucks, and the come lately money changers got their clocks cleaned. As they say in the computer biz, that's no a bug, it's a feature.

Here is a simplified expnation. Ad revenue is based on several models. All rates are based on cost per thousand people or cpm

1- uniques, hits, page views - the number of people who go to a site on a particular page on the site.
The cpm tends to be the lowest since this is a gross number and doesn't factor in whether or not
the person even saw the ad. Rates could be as low as $1.00 cpm

2- click thrus - the advertiser pays only for people who click on their ads. The cpm's are higher for this
since the number of click thrus is substantially lower than visits

3- purchases - advertiser pays only for those who actually take an action such as, buy something, send
for a brochure etc. This rate is the highest.

Since most media sites have only one revenue stream, it has been difficult for them to make a profit. As the amount of media sites increase, the ability to make a profit becomes more challenging as ad budgets get spread across more and more sites.

All of this activity is monitored thru 3rd party sites

FBs' has a significant revenue stream from zynga as well, 12-15% I beleive?

J

Stock pickin' can be mighty tricky.

Why even in the same bis'ness one comp'ny's stock can do better than some other comp'ny's. Who'da thunk it?

Toyota Motor (in green) vs General Motors (in blue)