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Originally Posted by Biggy2
If only it were that simple. I am sure on some of their joins it may be like that, but I doubt every single join they get costs them $100 per member, after all they are an insane brand with an insane member base - surely some people just remember who they are and signup to buy with an acquisition cost of $0. Also, in their last quarterly they actively discussed dropping media buys that were non-performing...
You all underestimate Marc Bell. The truth is, there's a reason he has millions and you are on GFY applying the assumption of one rudimentary statement or application you read to his whole business model as if this is 100% truth in reality.
I was doing some research for fun last night. As recently as Sept 14, Marc has actually been a buyer in his own stock of FFN at $2.75. Granted it was only 10,000 shares. What I found really interesting is him and soem of the other FFN guys are involved heavily in a REIT called ARR ( http://finance.yahoo.com/q?s=arr). This thing pays off a monthly dividend that yields 19-20% !!! Considering the gov't has just stated interest rates will remain low for quite some time, I'd say that might be a pretty interesting and quality buy to a shareholder, although I do need to look at it some more. |
biggy, i looked at the original ipos, and they all showed horrible negative cash flow, with the selling costs to get new customers out of line with their lifetime membership income. apparently the only way things balanced was by selling the traffic on to others or to upsell within the sites, but that was not clear from the ipo so i cannot speculate.
what marc bell is doing is likely trying to look for a pop in the stock. remember, he has lost 75% of the value of his stock holdings in ffn so far. but if he can buy more at a low enough price and get a pop, even $1 more, he can cut his losses significantly and perhaps even come out where he was when this started. its a good move, but it depends on the stock staying alive and not making it to zero before someone else comes along to buy them out.
when you consider how quickly the stock lost 75% of its value, investing in it now is either a stroke of genius or the fastest way to the poor house. we will see. chat with you again when it hits $1, okay?