GBIM publications
March 9th, 2012
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Private investors are likely to snap up shares in Facebook
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Investors line up for a stake in Facebook
Alexandra Goss Published: 5 February 2012
Private investors are likely to snap up shares in Facebook, brokers predicted, after the social networking site announced plans for a $5 billion (£3.2 billion) float later this year.
It would be the biggest sale of shares by a technology firm and could value the company at up to $100 billion. It reported profits of $1 billion for 2011.
Interest in internet shares is already high among private investors. Apple was the most bought global stock by clients of Barclays Stockbrokers last year.
However, there were mixed results for floats in 2011. Linkedin, the business networking site, has fared best, with the share price rising 71% since its listing in May, according to AWD Chase de Vere, the adviser.
Jive Software, which supplies social networking sites, is up 24% since listing in December, while Groupon, the daily deals site that floated with much hype in November, is up 15%.
Others have bombed. Renren, China’s answer to Facebook, has fallen 61% since going public in May and Friendfinder, a US group that also floated in May, is down 87%.
Philip Pearson, co-manager of the GLG Technology Equity fund, said: “We will be looking to participate in the Facebook float and already effectively have a stake through our holding in mail.ru, a listed Russian social network whose stake in Facebook is worth about a third of the firm’s value.”
Patrick Connolly at AWD Chase de Vere is more cautious. He said: “A real danger is that these shares are over hyped and investors end up paying a price that cannot be justified by the fundamental business performance.”
Ian Warmerdam, co-manager of the Henderson Global Technology fund, does not rule out investing in Facebook, but prefers Apple which recently reported record quarterly profits. “More strong growth and earnings are likely for Apple,” he said.
“The stock appears very attractively valued. It trades on a price/earnings ratio of nine times 2013 earnings, a discount to the S&P 500 (on a figure of 12.7 times) and the technology sector (12.5 times). Linkedin is trading on a figure of 27.”
Simon James at Gore Browne Investment Management recommends tapping into technology through a fund, such as the Herald Investment Trust or Polar Capital Technology Trust. Connolly would prefer to get exposure through US or global funds, such as Threadneedle American (22% in technology) or Neptune Global Equity (17%).
February 14th, 2012
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Simon James, founding partner of GBIM, said: "We are excited to welcome both Simon and Chris to our growing team; their appointment is part of our ongoing commitment to ensuring that we provide an exemplary and tailored service to all our clients.
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http://www.thesundaytimes.co.uk/sto/business/money/investments/article867181.ece
February 14th, 2012
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Our latest Bulletin endeavours to keep up with the fast-moving situation in Greece. We hope you find it brings a fresh view on a complex problem.
November 7th, 2011
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“The world of reality has its limits; the world of imagination is boundless” (Jean Jacques Rousseau)
bulletin aug 2011
August 22nd, 2011
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The Outlook for the UK Economy & Interest Rates, Investing in Japan
July 13th, 2011
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Growth, not inflation, should be the focus of policy
There is a cacophony of demands for the Bank of England to raise interest rates so
that inflation might be curbed in the UK. Such demands are misguided at this stage.
February 18th, 2011
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“Annual income twenty pounds, annual expenditure nineteen, nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought nd six, result misery.”
Mr Micawber had recently been imprisoned for debt. While we are not suggesting that Gordon Brown should be sent to the Marshalsea, we do need to heed the lesson on husbandry. The key to investing, when many parties are short of cash, is to recognise that those with cash will emerge stronger. This belief drives our current investment strategy.
January 27th, 2010
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Equity prices probably reached their nadir in March, since when investors seem tohave thrown off their fears that we were entering a period of depression, and nowthink that we shall merely have suffered a deep recession. There has been talk of‘green shoots’.
Analysts appear to be assuming that growth rates in the US and the UK will returnto trends of the last decade, and that profitability will revert to the historic mean; webelieve this is overly optimistic.
June 10th, 2009
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Historically low interest rates are causing serious concerns for savers for whom bank deposits and interest provide a substantial part of their assets and income.
Traditionally cash is the only risk-free asset available, although recently we bought UK Treasury stocks (gilts) for many clients, to capture interest payments as we expected interest rates to fall. This strategy has been successful, and prices have risen sharply. So what next?
January 27th, 2009
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