I wonder if Greenshoe is still in business?

http://www.forbes.com/sites/timworst...ors_picks=true

forbes FTW

Short answer is no (no pun intended) - T+3 is settlement. As they say, it's done.

So, as a lay person, would I be right in assuming that the IPO price is set to what the issuing company believes they can sell them all for, and that the regular share value reflects what the market believes they are worth?

If so, on the face of it, was what FB was doing what any company may do, to maximise the benefits of the offering? I mean, without the alleged tipping off to some insiders that the IPO was overvalued and the resulting investigations, of course...
The market value reflecting what the purchaser believes they can get out of the shares - whether in dividends, apreciating value for later selling, in anticipation of a stock option, and/or whatever - that would make these shares a better option than some other shares?

Ah, seems they may have increased the share issue to benefit from all the potential 'investers' who requested more than they expected to get from their allocation, saturating the market and quenching the interest in the shares.
Going to be interesting to see what happens about the investigations about the 'illegal' share trading before the IPO, the selective disclosure of revenue information and the artificially held stock value? Seems there are also many who tried to cancel their purchase but were unable to due to problems with the trading host...

All in all, perhaps this will go down as a lesson tought in business schools about how not to do an IPO?

In theory yes, but in practice not quite, because FB 'shares' have been traded on private secondary markets for years, fully encouraged by the top brass at FB, including brat-boy Zuckerberg. The people who own those 'shares' had a huge say in the IPO starting price.

The share price reflects the actual value of the buy/sell transactions as they occur. If you offer $32 and I ask $42, and there is no trade, what do you think the price is?

Ah, seems they may have increased the share issue to benefit from all the potential 'investers' who requested more than they expected to get from their allocation, saturating the market and quenching the interest in the shares.
Going to be interesting to see what happens about the investigations about the 'illegal' share trading before the IPO, the selective disclosure of revenue information and the artificially held stock value? Seems there are also many who tried to cancel their purchase but were unable to due to problems with the trading host... The issue wasn't people trying to cancel their trades. The NASDAQ were not able to match buyers/sellers because of an outage, and so many brokers didn't know their client's positions or the real price. This meant some orders were executed at the wrong price. However, trades can easily be cancel corrected before settlement and many were.

All in all, perhaps this will go down as a lesson tought in business schools about how not to do an IPO? Or go down as a lesson in how not to believe every scrap of BS you read about.

Ah, good, thanks for clearing up the prior selling legality, what I had read suggested it wasn't quite kosher.
I should have clarified - what I meant by "what the market believes they're worth" would have been what they're trading at.
I did say "perhaps" - do you think they made any mistakes in the whole IPO and it's follow up?

Well, it's a grey area. You can have up to 500 private investors without having to file with the SEC, but the secondary markets, OTC products and derivatives on the back of this are almost impossible to track. FB had many many more than 500 investors, and what they were doing ultimately forced the IPO. It's important to note that FB (especially Zuckerboy) didn't want an IPO at all.

I should have clarified - what I meant by "what the market believes they're worth" would have been what they're trading at.
I did say "perhaps" - do you think they made any mistakes in the whole IPO and it's follow up? It was executed like any other IPO, it just got 100x more attention. I am always surprised at the amount of surprise expressed when it gets out how much we're all getting screwed every day.

Facebook now officially the worst performing IPO in the last 10 years.

$28.50 right now.

Epic fail.

Who for? They raised $16bn... they still have $16bn. An Epic fail might have been if they'd only raised $10bn. One could argue the IPO squeezed blood out of the proverbial stone, no?

Shareholders, PR...

...and the legal department who will have to deal with the lawsuits http://www.discussworldissues.com/fo...ies/laugh1.gif

They may also have to pay an extortionate price for Opera if they really want it. I don't see why they don't just do what most [free] apps, at least on Android, and use about 1/10 or so of the screen at the bottom of Facebook mobile. Probably get a higher "click" percentage compared to desktop versions.

For the Shareholders who sold. I think that FB, given enough time, they can get into the league of Apple and Google stock price wise.

PR wise they don't have to worry. They can say "we raised a f*ck load of money and are going to use this to buy companies up left and right."

From some of what I have been reading, FB is going to be extremely interesting to watch, see what they do, how they execute it. Could be a great buy that pays off mindbogglingly in ~5yrs.

Based on what exactly?

How can a company at a near saturation point continue to rely on an ever-expanding user base?

Their business model isn't relying in that.

They need to monetize mobile - they'll either succeed at that or not. If they do, then there is a lot of potential. I think some kind of tie-in with NFC payments and very targeted marketing (some kind of electronic coupons) might be the way to go.

What you propose is a not a reality, yet.

As it stands today, they have little besides converging ad revenue.

Hmmm... let's pick this conversation up around this time on June 11th.

Am I missing something?

WWDC?

Zuckerberg? Yeah, they grabbed the 16 billion. Unfortunately, doing so tanked the entire value of the company, opened them and everyone involved to lawsuits, sullied their and the banks names even further and took a hammer to the knees of investor confidence. Big, big win. Totally worth their name. This is exactly how Zuck dreamed about it I am sure.

Unless mobile screens sizes quadruple, I don't see facebook making any money from it, and I doubt many will buy their phone.