News - Facebook (IPO) Bandwagon

On Friday 18 May, Facebook will launch of its initial public offering (IPO) on the NASDAQ Stock Exchange, with symbol -FB.  It will float 337 million shares with pre IPO price of US$38.

For Australians, FB's CDFs can be traded via CMC Markets.

There are mixed opinions on the valuation of FB. Here are a few number facts about FB, according to its IPO Prospectus:
- most widely used social networking site on the internet
- more than 845 million members
- approximately 483 million of these log into Facebook every day.
- annual revenue in 2011 was US$3.7 billion
- operating income of US$1.8 billion.
- profit in 2011 was US$1 billion.
- price for whole company, assuming IPO price, is over $104 biliion
- A simple P/E using IPO_price / Profit is roughly 100:1      - implying that the profitably can increase so much more in future. Do you believe that?

As a comparison with other high-flying, media grabbing IPOs, here are some stats about the opening price.

             IPO          Close    Close/IPO
 Google     $85.00 $100.33     18%
 Baidu     $27.00 $122.50     354%
 Groupon      $20.00 $26.11     354%
 Linkedin      $45.00 $94.25     109%

Lightning Analysis - ADE - Adelaide Energy

Lightning Analysis - Adelaide Energy

This is a very quick look at Adelaide Energy following a positive speculative news article recently.

http://www.news.com.au/adelaidenow/story/0,22606,25200329-913,00.html

http://www.theaustralian.news.com.au/story/0,25197,25444885-23634,00.html

Read those articles for yourselves - my impression from them is that ADE is a good speculative punt. However ......

I started looking at some fundamentals and technicals. Please note that this not meant to be a thorough analysis. But my quick calculations tells me that I would not be touching this stock no matter how good the news is until they get some more cash.

From their recent quarterly statement:
Revenue: $406K - first revenue after their purchase of Katnook Gas Plant from Origin.
Operational Cashflow: -$950K
Investment Cashflow : $1.083m
Cash at end of quarter: $409

Assuming the investment income is once off, and assuming revenue will be steady, if operational cashflow remains similar, say $900K, then ADE won't have enough cash to last the next quarter. At this point, I would stop all further analysis and wait at least to the next quarter results.



In terms of technical analysis, a simple Gann analysis would show that current price has almost reach the level of the last significant high at around 15c. Also that high point is about 11month to 1 year ago - another signficant time period in Gann analysis. This is a point to pause and see if it will break out of the resistance level and go higher.

In summary, although prospects of ADE sounds good, both fundamental and technical indicators suggest waiting before buying into it.