Personally I think there is significantly more downside for Facebook in the short to medium term but at some point no doubt the shares will be oversold. I don’t for one second believe the social media trend is over but I don’t think social media companies will have as much freedom in the future as they have enjoyed in the past.
Looking at the chart there appears to be significant resistance around the $180 level but support at the $170 level. A break upwards above $180 could see a relatively quick return to around $195 while a fall below $170 could lead to a significant collapse. I would wait for now....
Surely this rise is not on the back of plans for FB to launch its own Tidner style dating service? Will people never learn? Do they still trust FB with their private information? I am sure the regulators will be watching this one very very closely. Sell into strength..........
Interesting thought, if the founders believe that companies such as FB are under valued or misunderstood then taking them private must be an option? This is where the fun starts - would they attract the same price earnings ratio valuations off market? My hunch is no.
If this aggressive approach to business has made Facebook what it is today then do we really expect the company to change? While there is no doubt the company will make money out of “social media” activities the value of accurate and focused customer information, such as that scraped by partner companies, is much more lucrative. Personally, I am not sure how this one will pan out and whether or not we might see some subsidiaries floated off as individual companies but still effectively controlled by Facebook. Data collection is by far and away the greatest opportunity for Facebook to make potentially massive profits in the future.
The shares are in danger of falling through support around the $170 level. There could be a significant sell off is this was to happen. Would you go long or short of FB today?
FB shareholders can only hope the $170 support line holds. If this is breached then we will likely see further significant falls. It would take a brave investor to buy today with the price at such a critical point. Personally, I would leave it alone for now but fortune does favour the brave (sometimes!).
I see FB is launching a compeititor to YouTube - or is it a relaunch of an existing service? Either way I think this "launch" is too little too late - YouTube has that space sewn up.