Fox Business
Expand
Browse All Video
Watch Live

You're watching...

Will Facebook Sink or Swim on Day 1 of Trading

Details

  • Description

    Dan Shaffer of Shaffer Asset Managment argues the stock is too pricey to take off.

  • Duration 5:31
  • Date

Clips

Also in this playlist...

Latest Technology

Auto-advance: ON

Auto-advance
View All

Transcript

This transcript is automatically generated

Indenture if please -- data is with -- -- Asset management let's get right that it what do you think the closes today I think it has a high potential closing at 38 right -- open -- be a lot of noise during the day.

But the minutes to support at the end the market's very happy and I think of sellers will come in at the end of the day you know particularly calf of this company -- a long time on the way over Barack's way -- is too much retail interest should I've seen this -- -- -- I think what -- went too much retail interest that the likes of me that's the little guy the little guy can act on released more shares so they can give more to the retail market.

And my through the to look.

Bubble crazy reminds me of the dot com craze you know it's a great company well what's going on -- earnings they're not growing like they used to.

They even talked about that.

How -- they really gonna monetize -- -- and people preparing to Google it's not a global one Google's search engine what you're giving -- totally -- what is different -- wait wait wait wait Google.

Indeed wasn't such engine still lives and then it use the money from such to branch out into Droid phones from which makes a great deal of money.

But they are but these focus nowhere near that how do you know Brazil Iran IU industry can't develop a whole new offshoot that will be wildly profitable and they probably can.

But the -- the price of the stock is now based on their gross earnings their net income and the growth in the last four quarters.

It doesn't look like it's gonna happen and then again look at the demographics of the people that are using this to they have the money to support that advertising.

Is in General Motors questioning some of this yes they have been there all has gone the other way and said we like FaceBook advertised before -- the marketing that age group look -- -- it would American Idol.

The Ford commercials but with an income going down people not having jobs and isolating that age demographic.

Will this stock be able to grow in this current economic environment I think it's way ahead of itself.

Right -- they haven't yet you would not buy this thing that I would not be a buyer of this stuff and would not be buyer even -- co -- open at all at all because it's it's selling at at five.

Over five times the S&P.

That is too rich for my life I think a lot of professionals and Europe professional in this marketplace a lot of people saying exactly the same thing as you.

It's overpriced.

I don't see whether revenue and the profit stream is in the future to justify a hundred billion dollar about it that's -- a lot of professionals -- And I think that's counterbalanced.

By all the little guys out there who think this is the next Google -- -- jumping in -- it may be -- I have no question that it may be.

The right today.

With the pricing of the stock the weak earnings have been and some of the little bit of trouble with advertising.

Monetizing -- that this demographic.

In this environment of our economy going into.

What I consider -- deflationary depression.

They these advertisers are going to want results.

If the results aren't there.

We've seen television and radio shows when advertisers -- -- they can be terrific shows testimony don't have appetite I guess -- back -- product Christmas -- -- ago right.

This could happen with FaceBook in a deal like when you're looking on your phone or or you know when you're doing that you get a pop up advertisement.

But yeah it's annoying to me -- can you are assuming that's the only way that they can bring advertising revenue and understood to have -- didn't -- enough Spanish everything else you don't think they will.

Up must be on the eight -- so that they -- okay.

They may but at this justification of this price based on expected forward earnings of what they currently have today.

I think it's way overvalued it weight pipe and and I think -- the stock could actually trade below 38.

You realize we gave you more time to give you a negative opinion on FaceBook than anybody else on the shows have -- you and it's.

Not a negative I didn't -- you know wants and I appreciate that because people need to realize that this game in the market.

Is -- In smoke and mirrors and sometimes it's taken to a level where it's talked about 24 hours a day.

And people around the world are are so it to this when you have all the buyers in and there's no more buyers left what do you have.

999 Connecticut -- have on the defensive that this what's happened you look at all the IPOs have come out in the technology -- -- fine piece of American capitalism this -- -- one -- all -- -- great as they already received -- category all the nor condone price it right price it right so it can grow.

Don't price -- at its high end of the range and that issue more shares because the retail demanded more.

Look at that doesn't make sense that shows -- users -- a snob you what I'm not.

I was gonna tell us sector of the market don't know in the -- I don't know all of -- -- while we hit thirty history has shown the retailers usually wrong.

Okay we we we've learned that apple history Google apple went that dollar.

After it came out where is it now it's -- course happen because why because after reading involved again.

It made its mistakes not get learned from the past -- -- and then.

Yeah okay and then created on Diane you never know if republic can't really shut up if that -- Curtain not a -- -- done that that's a public company -- watch more reforms that happened don't want.

Then check up.

Like his style that the Europe persuasive argument thank you much indeed run by the way I wanna tell everybody I am not recommending FaceBook I'm not it in it or against it I don't know where there's a good investment -- bad I will not be buying this stock at any time.

So I have no dog in this -- okay I'm expressing no opinion on the future value -- face.

Load More