Meta Platforms, Inc. (META)

Feels that a lot of people bought this on the IPO and he doesn’t see the stock going back to that price anytime soon. There is a lot of opportunity potential with a stock like this if they can convert what they do into ad revenue, some kind of data analytic business or maybe do an acquisition where they can augment their current core business. He fails to see what kind of revenue this business can derive for any sustained period of time.

She is a value investor so she finds this one difficult to know what they are going to look like in a few years time. She is not in this space which is changing very fast.

Trading at about 35-40 times earnings. Also, doesn’t understand how they make their money. There are other great companies that are trading at a 3^rd of that multiple.

SHORT – Valuation is rich. More and more data is coming out about young people moving off of Facebook.

Long ZYNGA (ZNGA-q) and Short Facebook (FB-Q)? A pairs trade that he would probably not put on in his funds. Zunga is interesting but its business model has run into a lot of problems and come under a lot of pressure. One of those sort of failed tech IPOs but is a very beaten up stock. Has quite a bit of cash on their balance sheet. This one, on the other hand, is a really good business, great company but expensive. Has always found with pairs trade that trying to buy a value, kind of “not great” company at a low price and short a really good company at an expensive valuation to play that spread, typically does not work out well.

Difficult to say what is going to be the scenario in the long run. Hard to model what positions companies like this are going to have 5 years from now. As a value investor, she finds this is trading at a very high PE.

22% of active users online time is spent on Facebook. Only 4% of ad revenue. That is a huge, huge opportunity. New apps will drive monetization of ad platform.

Likes it here. If you own Google (GOOG-Q), you almost have to own this as a hedge on the other side because, between the 2 of them, you are going to own the search market. Looking at the way they are starting to monetize effectively the wireless mobile operations, he feels they will be deriving profits here. Valuation is high but as long as they continue to deliver earnings growth, it will stay high.

Earnings in two days. He doesn’t like it at this level. You could trade around the earnings but he would prefer to take some money off the table here. Long term, they are going to be around, so you have to buy it when the value is there.

Very volatile and has had a remarkable resurgence in the last several months. Created a remarkable amount of value in a very short period of time. Growth in users has been astronomical. For him it is very difficult to figure out if they can monetize that large user base and how they will monetize it. Would prefer Google (GOOG-Q). You pay a high valuation multiple on this.

Doesn’t touch IPOs for the most part as he thinks they are fools game except for those who are selling them.

Would not buy it here. If you hold it maybe ride it out. The valuation is too rich for his style. Not convinced in the company yet. Still confused about where the revenues come from longer term and how they will manage the company.

Revenue is growing at a pretty good clip. Have 2 problems. Something called Virtual Good Sales makes up 15% of their revenue, which is something she does not want to touch. Also, there is a danger when you have a lot of expectations for the future. Trading at 50X next year’s earnings and she doubts they will be able to earn more in the future than they do today.

Social media is all about buzz and there is less and less buzz about this company. Big question has always been, how will they make money running the company as well as on mobile devices.

Has done relatively well. Still down substantially from the IPO. Great business but not necessarily a great stock. There will be people who got shares at the IPO who will be waiting for the stock to get back somewhere near the original price and then will start letting it go.