Greg R @TheRakker: FB IPO, should I buy?
ANSWER:
We have these visceral memories of the MSFT in the 80s, YHOO in the late 90s, where simply looking at stock cold make you rich. So the natural question, is Facebook filled with the magic. Will it turn janitors into millionaires, secretaries into island-owners. We’ll see.
Let’s hold off on the answer. I’m a long-term bull on Facebook. It’s got a billion users, etc etc. We can argue all day about it. That’s what creates a market. Do I own the stock? No. Whatever
But let’s look at what the mainstream media had to say about Facebook after the IPO was over Friday evening. It’s a funny and important lesson. Here were some of the headlines:
Facebook: The new Mount St. Helens?at MarketWatch
Facebook falls flat in public debutAP
10 of the stocks that outperformed Facebookat MarketWatch
Is This a Terrible Sign for Facebook Investors?at Motley Fool
Facebook IPO Fails To Boost Morgan Stanleyat Forbes
Scramble for Facebook stock ends in “Face-flop”at Reuters
No First Day Traction For The Facebook IPOat Seeking Alpha
What the hell happened? You would think Facebook was going bankrupt, that they made every mistake in the book, that the IPO was a total failure and that everyone lost money. There was not a single positive headline. And that much mainstream media must be correct, right?
But guess what. Let’s look at the actual FACTS.
-Facebook closed positive on the day. So anyone who bought the IPO was up.
– Facebook closed at higher than $100 billion market value. That’s incredible. Particularly since I was trying to negotiate Facebook share transactions 20% lower just a month or so earlier.
– Facebook managed to pay their bankers only a 1% fee instead of the traditional 6% fee. So that’s a stab against Wall Street. Go Facebook!
– Facebook raised the amount of money they were going to raise to $12 billion at less dilution to their shareholders (they raised their selling price from $35 to $38.
So it looks like this was a home run to Facebook. Why didn’t a single media outlet report it that way. I’m not biased. I could care less if the IPO had “failed”. But it didn’t. It was probably the most successful IPO in history in that Wall Street didn’t rape the company dry at the expense of all shareholders.
But haters gonna hate.
ALWAYS check agendas always check the facts, never listen to the media. Try this instead of reading the BS media. I love doing this trick. Put two fingers on your closed eyes, put your thunbs on your ears, put your remaining fingers on your mouth. Now nothing from the outside can get in.
Listen.
You’re listening to the smartest, most unbiased thing you will hear all day.