So I return to the letdown I'm feeling with my Facebook trade -- one where it seems it's only going to get worse.
Going Back to the Party?
On Friday, TheStreet writer Chris Ciaccia offered some compelling reasons for believing that Facebook's stock had 25% more upside left -- this after it had already gained 23% at the point of my sale.
At this point it is hard to disagree with Chris, however my trade was predicated on the tenet that "greed" has never worked as trading strategy -- at least not for me. I understand that on Wall Street as in Vegas casinos, in order to make money one has to always be willing to leave money on the table.
What appears that have worked against me in this trade is the fact that Facebook, unlike other stocks, does not yet possess sufficient trading history to offer investors an adequate gauge of exit opportunity -- particularly from a technical point of view. However, that does not appear to matter for analysts who have recently become bullish on the stock. Ciaccia pointed out that Nomura analyst Brian Nowak initiated coverage on the social networking giant with a "buy" rating while setting a price target of $40.Furthermore, he said despite near-term issues and concerns about being able to monetize its 900 million users, Facebook can reach his target by charging for branded pages, improving its advertising units and generating revenue from mobile. This comes on the heels of Mark Harding of JMP Securities, who thinks that the stock is heading to $37 upon initiating coverage with an outperform rating. He cautioned that the "valuation appears high, but Facebook has plenty of opportunities to monetize its vast user base." Essentially, I've sold too soon as the stock is now believed to be heading higher. The question is, should I now focus my energy on trying to get back in? Will this be another mistake and risk buying higher or should I wait for the stock to drop below my recent sell price? What will come first?