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Zynga, Inc. Message Board

  • odonnellm66 odonnellm66 Jan 11, 2013 9:39 AM Flag

    Question of the Day: What is the good faith value of ZNGA?

    With a long established company like Coca Cola, that number is obviously huge. In fact you can nearly equate the word cola with Coke. ZNGA has none of these characteristics, so what is the company really worth? ZNGA does own a basket of patents on intellectual property covering concepts with a shelf life not much exceeding that of a loaf of Wonder Bread--silly games, that is. The company model is easily replicated on a small scale out of a garage or apartment, and in fact this is already being done in a city like Santa Cruz, CA, a sort of mecca for the gaming gods. Any serious ZNGA gambler (there are no investors) should have already watched the documentary "Indie Games--the Movie," a film which adequately details cutting edge gaming development for the true addicts. Keep in mind the addicted minds are really the sole source of revenue for ZNGA, as the vast majority play for free. These hard core players eventually seek out games of varying complexity and nuance not on the bull dog menu. ZNGA is gaming for the masses, and serious gamers, the quirky types they be, desire the label of iconoclasts. Bland vanilla ice cream--Farmville-- won't do.

    Summary: ZNGA is essentially worth its cash assets and revenue minus cost of operations. Cost of operations with lagging revenue will be sore points on the next earnings report. I think about this each time I pedal my bicycle (a politically correct mode of transportation in S.F.) by the ZNGA brain trust on Townsend Street. I can only wonder what it costs to pay all the button pushers, lawyers, chefs, and massage therapists. What does it cost on a monthly basis just to keep the doors open? There is also a wealth of information to be found in the hipster cafes/bars in that neighborhood from former and current bull dog employees. I can only wonder why Wall Street does not do this type of in depth research, since billions (yes, with a B) have been vaporized on this hype. The only hope for this pathetic outfit rests in legal online gambling. As I have previously pointed out, that fantasy is merely a pipe full of Humboldt's finest green bud. Smoke it if you got it. You will need some relief by the Ides of March.

    Sentiment: Strong Sell

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    • Another amazingly articulate post ... didn't agree with any of it but you've got talents ... let me know if you ever write a book, I'll buy it ... Cheers

      Sentiment: Strong Buy

    • Smart people know never to short based on valuation. It's a little known secret. You need to recognize, old man.

      • 1 Reply to uh_huh_yeah_01
      • Beware youngster, with age and interesting experiences wisdom can be honed. I did not spend my green salad days sitting in some cubicle. My critical point is no one will be foolish enough to pay a premium for a failed business model. ZNGA has no physical product or anything vaguely resembling utility, and it ain't no Google. A ZNGA clone can be up and running in three months or less. The barriers of entry to this drug of mass conformity are minimal at best. Some of the very best "creators" are probably still in high school. Menial tasks are best outsourced to China or India. I lived in China for a period, and I know directly the skill level to be found there, and how cheap it is to be secured. You are correct on one point. In the current equities hysteria, going strong some four years now, valuations have become meaningless. Our own Federal Reserve is primarily responsible for this bubble, as cash is trash in the current environment. Did you know a balloon as it rises ever higher in the atmosphere eventually pops? I suspect it occurs this year, and this time the Fed will be powerless to run to the rescue. We are in for much excitement. Here's a bit of the Irish for you in this no country for old men.

        An aged man is a paltry thing
        A tattered coat upon a stick
        Unless soul clap its hands and sing
        And louder sing
        For every tatter in its dress.

        not an exact quote, but close enough.

        Sentiment: Strong Sell

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