Sunday, September 30

Investors wondering whether another camp tech bubble bursts

Is Facebook still fall? Weigh Pacific Crest securities analyst Evan Wilson and Michael Pachter, Wedbush securities analyst, with trade across the social network company.

The share price value of some of the most well known social media stocks in the doldrums, investors in these companies have itself a question recently: we have again fool get?

During the so-called Internet bubble plowed before a decade investors like money in scores of new Internet companies, which had virtually no sales growth, bets, that technology would change the world and the new dot-coms eventually would turn a profit.

After the collapse of some dotcom names such as, but eventually again and move higher, but in many cases, investors have been proved wrong and the companies, which in investing, had collapsed.

Some are now proposes an another dotcom bubble in the social media space is brewing. The best known example, the, is to show the, Facebook. After years of speculation, that the social media giant public would go did fallen 53 percent in May and since then the stock price and count, flush away from more than 50 billion $ market value.

Facebook's share price hit a new all-time low Tuesday, fall under $18 for the first time, even though it is up here in after-hours trading on news of the company had started, investors and its own employees as its stock price spirals after to calm down.

In a regulatory filing that said social network its CEO Mark Zuckerberg sell not shares of the company for a year, and promised not to sell, one almost to cover tax liability is $2 billion. Social networking moves back effectively buy million shares which will probably bolster its schwachelnde share price this fall and allow the employees in their camp weeks earlier than planned to cash.

Facebook's losses since the initial public offering are not quite as dramatic as that of the other social-media company, which went public last year, including online-gaming site Zynga, the stock price has last 71 percent since the IPO in December year decline, and GroupOn, which has seen the value of the shares diving 84 percent since the IPO in November last year.

The sharp decreases have less with shaky business models and more to do with sky-high expectations for the companies in the emerging social media space, to do, said Jay Ritter, Professor of finance at the University of Florida and expert on initial public offerings.

"Facebook is money making;" It has a successful business model. "As a company, it has continued to perform, although (the Manager) difficulty, money earn with mobile users have had", Ritter said. "The problem has been for investors at a price purchased, divided into very optimistic expectations (for the company)."

S & P Capital IQ equity analyst Scott Kessler is also optimistic. Recently updated he his views on Facebook a "buy," saying that he thinks that much about the potential threat of Facebook's share price as a result of time "depends on a so-called" for the most important investors in the company, is made. The period prevented some early investors-usually venture capital investors and insiders from the sale of million shares that they own in Facebook.

The company focuses more on the monetization of their mobile users now, and in this context, it "better than expected" running, he told CNBC Tuesday, adding that the share price to a level has declined, which makes it even more attractive.

"We see a pretty attractive rate now," he said.

A more moderate view of Internet companies a good sign for the industry is, analysts say. It suggests that technology has evolved since the speculative days of the dotcom boom.

A bright spot in the social media space is LinkedIn, a social network to manage your professional identity and looking for a job. The stock is currently more than 14 percent from the IPO successfully took advantage of a niche in the social media in May of 2011. LinkedIn, Ritter said.

In contrast to this fighting online game site Zynga, to convince investors that it can sustain growth, he added. And perhaps the biggest victim of overly high expectations website is daily deals GroupOn, which went public in November 2011 to great fanfare and with a value of $13 billion. It has since about three quarters every day much shed its market value on concerns about the growth of the business of.

"Groupon high cost, and this is one of the issues which continue as well can be their business model a question mark over," Knight said.

Picking winning stocks is a difficult task, even for professionals, of course.

Knight notes that their share prices by at least 50 percent of their asking prices on their sixth month birthday saw fall 49 companies that moved exchange between 2001 and 2010.

They lost 49 companies 63.1 percent on average in the first six months of public companies, but in the next 18 months on average had a rest, positive with an average return of 22.5 percent during these 18 months.

Knight adds that, if an investor bought shares of technology heavyweights like Microsoft and had held the returns of stock Oracle if it was the 1980s, and "on the ride" losses would have compensated.

Venture capitalists expect that most businesses to lose money that they invest, but they they "10 baggers"-companies such as Google, who call their initial investment as much as 10 times, Ritter said back account.

"If there were a simple rule for fund managers, consistently beat the market it would be easy" he said. "And the proof is that it it just don't."

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