Seems like a lot for a chain of fitness centers...

For a company that has been around for 6 years and has not made any money it seems like madness. I heard 34 billion on the way to work but that might be Canadian dollars :).

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They constantly try to escape from the darkness outside and within
Dreaming of systems so perfect that no one will need to be good T.S. Eliot

Two simple reasons:

1) Facebook's initial market cap was ~ $80B, it peaked on the first day at $104B, it now trades at ~ $400B. People think Snap has that same trajectory.

2) The lock-ups here for institutional investors is insane at 1-year, meaning free traded stock is going to be in short supply. This means the runs up could be huge. If you had pre-IPO shares you are already at a 50% gain.

Everyone is hoping for another Facebook. Trouble is Facebook was the first big social media company so it has a giant customer base. They make tons of money with ads and selling everyone's private info and they use that money to acquire potential competitors. It might not happen initially but I think Snaps stock is more likely to like twitter than facebook.

Wasn't Facebook profitable when they went public?

Snap listed net losses of more than $500M last year. Not saying it can't happen, but they have much work to do to justify this valuation. Market cap is up there with (or higher than) ebay, Sprint, Intuit, etc. Wow. Then again, fundamentals haven't mattered in several years.

edit to add: I found this on Variety.com:

Losses: Snap’s 2016 net loss was $514.6 million. In 2015, the company lost $372.9 on a net basis.
How it compares: It’s expected for Snapchat to lose money this early on in its growth cycle, but the rate of Snapchat’s losses has some concerned, especially if one compares it to pre-IPO Facebook: The social networking juggernaut already generated $1 billion in net income in 2011, the year before it went public. Twitter on the other hand had losses before going public in late 2013, but those were a lot more manageable. In the first six months of 2013, Twitter had a net loss of $69.3 billion

Facebook made $1 billion in 2011.

I'm not saying its rationale, but I think that is the way people justify having/wanting to own the stock.

Wasn't MySpace the first big social media company?

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Pink? Maybe. Maybe not. You decide.

Same number of users as Twitter and Twitter's value is a third of Snaps and Snaps may reach the same revenue number as Twitter by 2018 around $1.8B.

FB and Twitter seem cheap compared to Snap but the VC firms need an exit strategy as their investors are getting tired waiting around to see a return on their capital. With this market you will see more overvalued IPOs.

Stating, "I missed out on FB so I'm buying SNAP." is a more rational statement than comparing their balance sheet to pre-IPO FB.

We are saying the same thing. I just responded to the question asked. However, profits and losses are income statement items, not balance sheets.

Yes, I realize your post wasn't "your" explanation for justifying the purchase of SNAP.

Thanks for correcting me. It is an important distinction. Is there something on SNAPs balance sheet that might change the opinion of someone who thought the IPO was overvalued?

Someone please explain to me why people are buying into this IPO:

People are buying because other people are buying.

I think MySpace and facebook came out around the same time but facebook took off and MySpace died.

MySpace was popular earlier than Facebook. I think MySpace died when Facebook's popularity took off.

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Pink? Maybe. Maybe not. You decide.

Let's see where it is in a week. Personally I'd short the shit out of it

I just bought a shit ton of AOL stock! I'm retiring at 45 bitches!!!

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If there are no dogs in Heaven, then when I die I want to go where they went. - Will Rogers

Emery's Third Coast Triathlon | Tri Wisconsin Triathlon Team | Push Endurance | GLWR

You jest, but isn't AOL approaching 20 years old? These fads always come back!!!!!

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Pink? Maybe. Maybe not. You decide.