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Zynga, Inc. Message Board

  • johnboy00792 johnboy00792 Feb 17, 2012 8:08 AM Flag

    Why Znga is a bad investment

    - Extremely low barriers to entry - FB could easily make their own games and take 100% oi profit especially with their new payment product.
    - over 1 million other free games to choose from
    - costs more money to make the games then Revenue they bring in.
    - Non GAAP used as GAPP would show the true weakness
    - Company is not transparent on details on number of paying clients out of the Active users. This is for the obvious reason that they do not want to show how few paying customers they really have as this would send investors running.
    - Growth last quarter sunk to single digits ... this is only typically in mature companies not startups.

    - Only possibility for this stock is to go so low that they can be bought by a larger company. No way this will occur with the price where it is now.

    I do not care either way however if you are long you should consider what changes you think will begin.

    Any using the poker game as a reason you may want to think again about all the other companies again that they will compete with.

    Four people with smart phones and FB accounts and all play other free games as paying for a social game makes no sense when there are 50 other similar games for free.

    Either way it will be interesting to watch this stock. So long or short gl!

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • No I meant to clarify this is not to mislead. I did sell this short and have already closed my position.

      I am actually going back again to see why I should not short again. IE. is there a reason the stock is worth the investment or is this truly hyped as the many reports and analysis say or is there a true value.

      I did attempt to pull up the cc call transcript to highlight the specific response however I am unable to locate the transcript ... I typically use seeking Alpha's site but it seems there is not one available. However if you are able to find it or go back to the recorded cc call and fast forward to the Q&A you will find several reference in which refer to the response I was highlighted.

      I am sorry if you feel this was a lie because that was not the intent. However I am still am concerned with the inability to to see the details of the game. You can have a free popular game even being the most popular on FB however if you are not making any money on it then it does not seem that doing more of the same thing will increase revenue only expenses. Which in turns means this company will not be successful.

    • You should, "clerify" huh? Ok, so why didn't you, "clerify" to begin with?

      You specifically said, "Company is not transparent on details on number of paying clients out of the Active users" and "which zygna does not provide information on number of paying customers." Both of which are deliberately told to mislead people into believing things that aren't true. Which is what lies are. You are lying. You are basing your position on a pack of lies and therefor are even more of a moron than I thought you were. Not to mention that you pass of these deliberate lies as some sort of analysis.

      I really thought that there might have been even one reasonably intelligent short on this board, but I guess not.

      you = moron = ignore

    • I should clerify ... they did cover MAP the information they did not disclose was the MAP user per game and if each were up or down or breaking out online vs. marketing.

    • You will see the point by researching Non GAAP accounting. Typically (not always) firms use this and the concern with using Non GAAP accounting is that it allows for "creative accounting".

      This is related to the issue of transparency ... you will find the general agreement is that it is used to hide weakness.

      Recent article GRPN goes into the concern a bit further.

    • why i disagree with some of your made up "facts"
      facebook relies on ZNGA as much as znga does facebook. 12% of revenue for facebook was from ZNGA. can facebook make their own games? sure, anyone can, but ZNGA has the most played and top social games.
      Also, the company swung to a net loss of $1.22 per share because of $510 million in stock-based compensation expenses at the time of its December IPO. that is a 1 time charge, but some idiots point to it that ZNGA lost money based on their business model, that didnt happen (which is why they beat the estimates with .05 not .03 when it is looked at properly.

      • 2 Replies to kevinb632001
      • Also ... ask yourself ..

        How many people do you know that play any of the games?
        Also how many people out of the number above actually pay for the games?

        take the number above and add it up over a yearly bases. Remember on 22% of their users are active daily/monthly and they will not post how much of the 22% actually pay and how much they pay.

        The fact they will not disclose it is concerning as if it were high they would most certainly release the information.

      • I guess what made up facts are you referring to. You can read the Q&A from the earning call to see how they did not provide the details on paying customers or metrics.

        Low barriers to entry easy that is obvious

        Non-GAAP accounting ... read up on it as GRPN used the same methodology and was creamed for it as well.

        Not sure what other made up facts you are referring to but you can do your research on the topics and you will find all to be true.

    • I think Facebook is a one trick pony. If you compare Facebook to Zynga, whether you like them or not. Not sure what year Facebook started, but the have been around long enough to expand into different areas.
      Zynga started in 2008 and are moving forward and expanding and following the technology trend.

      It could be my dislike of Zuckerburg too, but I yelled at the TV when they tried to compare Mark Zuckerburg to Steve Jobs, after Steve died. Now if Pinkus keeps pushing forward and could create tech devices he could really compete...the zcloud is a nice step forward.

      teaming with Hasbro for the toy deal was something different

    • It's just a flat out Awful Company!

      Poorly run.

      No Customer Service.

      • 2 Replies to ussashe
      • What company has awesome customer service? Its a high turnover rate and if you can type a llittle and answer the phone=breathe you can qualify for customer service.

      • Interesting ... I thought I would test this out

        Below are the results

        Called in for support which is advertised as 24/7

        You have the options of
        1 help with game play
        2 help with technical issues
        3 for billing issues

        The first two options direct you back to their web site and email support.

        After selecting option 3 you get a message that an agent will be with you shortly.

        I was on hold for a total of almost 10 min

        I would say support for a new company is key. I can see a 10 min wait if I was calling into a larger firm however a 10 min wait before you even begin reviewing a billing issue seems to be above what it should.

        I will say if I was playing the game and had technical issues I would not want to email my questions and wait for a response.

        I would agree with the overall assessment that support is below average.

        Seems it will only get worse as they look to expand games and platforms.
        Looks like they will need that PR firm for sure.

 
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