Felix Salmon

How I lost my Groupon bet

November 10, 2012

Last year, when Groupon went public, I entered into a “small wager” with Rocky Agrawal. We would check back on Groupon’s market valuation in one year’s time, and compare it to the valuation of Priceline. At the IPO, Groupon’s market capitalization was 72% that of Priceline; if that number fell below 30%, I would lose. Otherwise, I would win.

Chart of the day, AIG edition

October 25, 2012


If you haven’t read it yet, you really must read Jessica Pressler’s fantastic Robert Benmosche profile — the man really shines through, in all his blustery glory.

Animated chart of the day, Apple vs Microsoft edition

September 18, 2012

Back when this blog was on hiatus, I put a chart of Microsoft and Apple valuations up over at felixsalmon.com. People liked it, and so I decided to take the obvious next step, and animate it. The result is the video above, and this gif.

The problem with buybacks, Dell edition

September 4, 2012

Fifteen years ago today, on September 4, 1997, Dell stock closed at $86.69 per share; on a split-adjusted basis, that works out to $10.84 per share today. The stock peaked at almost 5 times that level, in March 2000, but it’s not looking quite so hot any more: it’s now back down to $10.52 per share.

The Facebook investors’ lament

September 4, 2012

Andrew Ross Sorkin has a rather odd column about Facebook CFO David Ebersman today, blaming him for the miserable trajectory of Facebook’s stock since its gruesome IPO. It’s hard for me to disagree, since I said exactly the same thing back on May 23 putting Ebersman at the very top of the list of Facebook incompetents.

Facebook’s Faustian bargain

August 6, 2012

In the run-up to Facebook’s IPO in May, Henry Blodget explained just what it was that made Mark Zuckerberg a great CEO: his ultra-long-term time horizon. “It often takes decades to build the sort of companies that the best executives and entrepreneurs hope to create,” wrote Blodget, explaining that Facebook’s dual-class share structure, and Zuckerberg’s control of the company, would allow the young CEO to build a company for the ages, rather than one which hurt itself by chasing short-term profits.

The HP capital-structure arbitrage

August 1, 2012

Last week, Arik Hesseldahl — a tech writer who’s the first to admit he’s no expert on finance — discovered the wonderful world of credit default swaps in general, and single-name CDS on Hewlett-Packard, in particular. The cost of single-name protection on HP has been going up, and that can only mean one thing: it’s “mainly a barometer of the state of anxiety over its finances and its balance sheet”, he wrote.

How the tech-stock valuation curve inverted

July 29, 2012

Is a bubble bursting in Web 2.0 stocks? The NYT says there is, and says indeed that this implosion is even more dramatic than the one we saw in 2000. In reality, of course, it isn’t.* In 2000, trillions of dollars of wealth evaporated as the share prices of thousands of companies plunged to earth; in 2012, by contrast, we’re talking about a mere handful of companies, including Facebook, which, with its $65 billion market cap, still looks pretty well valued to me.

Why going public sucks: it’s not governance issues

July 17, 2012

Marc Andreessen agrees with me that it sucks to be a public company. But he disagrees on the reasons why: