Facebook Stock is Worth $7.50 a Share at Best

Email

Duh on you if you bought the Facebook IPO.

Double duh if you're thinking of buying Facebook stock now that it's fallen to $32 a share and lost $17.16 billion off its initial $104 billion valuation.

The company is only worth about $7.50 a share. And, no. That's not a typo. There is no missing zero or a placeholder.

That's reality. What is ludicrous is that Morgan Stanley and Facebook executives thought the company merited a $104 billion valuation at 100 times earnings.

As my good friend Barry Ritholtz pointed out recently, both Apple (Nasdaq: AAPL) and Google (Nasdaq: GOOG) debuted at about 15 times earnings. Today they trade at 13.6 and 18.2 times earnings and 3.75 and 4.9 times sales respectively.

As I type, Facebook's market cap is $86.84 billion and its price to sales is ridiculously high at 21.01. I think that's way out of line.

So what should the numbers be?

Try this on for size. If we use Google's price to sales ratio of 4.9 (and I am being generous here for discussion purposes), that equals a total market cap of $20.24 billion or 76.68% lower than where it's trading today.

With 2.74 billion shares outstanding, that's equal to only $7.39-$7.50 per share.

No doubt I'll get the evil eye from the Facebook faithful and Morgan Stanley for saying this, but think about it.

Revenue is already slowing and the company does not and cannot possibly dominate the mobile markets that are becoming the preferred channel for millions of people.

Worse, startups are already cannibalizing Facebook's user base as concerns over privacy and who likes who mount.

Companies like General Motors (NYSE: GM) are deciding not to renew their advertising. This is going to hit Facebook to the tune of $10 million a year for the loss of GM alone.

More will undoubtedly head out the door for the same reason, since Facebook friends don't necessarily translate into revenue.

Corporate buyers are beginning to figure out that advertising on Facebook is simply not cost effective versus other media alternatives – gasp – including good old fashioned television and radio advertising, billboards and tradeshows.

Facebook Stock: At the Mercy of the Merely Curious

Many people think this isn't a big deal. They couldn't be more wrong.

Facebook serves up its ads while you're kibitzing about your latest trip or checking out pictures of your family's newest arrival. This is very different from how Google works, for example.

Google's adverts appear after a customer has already entered search terms and refined the results they want to see. Facebook's approach is like pissing in the wind and about as effective.

In practical terms what this means is that Google search advertisers know that those who click on their ads are already hunting. So they're willing to pay a few hundred dollars to acquire a paying customer.

Facebook advertisers, on the other hand, are at the mercy of the merely curious. That means the acquisition cost can be dramatically higher, perhaps even into the thousands of dollars.

There are very few business models and products where that kind of marketing expense is "worth" it.

Then there's the whole "like" thing.

That's badly flawed — the Internet equivalent of signing somebody's yearbook in high school.

According to the technology savvy wunderkids at Facebook, "likes" are supposed to open up a magnificent relationship between prospective customers and the brands they "like."

Maybe this worked at Harvard when you were talking about bars, people and local hangouts but I don't buy that it's going to translate into real sales. So what if you become a company's friend?

When you "like" something, you get a stream of information from the "likee" that appears on your personal Facebook wall.

Go on a "like" binge one day and suddenly you've got 20 or 30 streams of information coming in right next to pictures of your hot rod buddies or school chums.

Over time, what happens is users tend to block out these streams in yet another never ending battle to screen out visual vomit, thereby robbing companies of the very connection they crave.

Your initial "like" never goes away, but depending on the barrage of information you receive I submit that brand negativity actually builds up.

If I "like" a genre-specific museum that's just opened up in town, I don't want to see totally unrelated posts about nearby milkshake parlors issued by the museum in a pathetic attempt to keep their brand front and center on my "wall."

The real measure of any business is how it handles the "dislike" button – but Facebook doesn't offer that.

According to the marketing cognoscenti and my own personal experience, most of the companies that advertise on Facebook are far below the 3-4 interactions a week needed to prompt a customer response. That is, unless you count the four-letter words every time I get an irrelevant "story" posted to my wall.

It's no wonder to me that very "unsocial" networks are already wiping the shine from Facebook's apple.

The assumption that Facebook can maintain the 100% growth it reported Q2 2011 is no more plausible than the 45% growth it reported most recently. Google couldn't. Apple couldn't. And both of them are real businesses.

So Now What For Facebook Stock?

I think Facebook's valuation is the least of its worries. The blame game now underway is only the tip of the iceberg.

Morgan Stanley, Goldman Sachs (NYSE: GS) , Facebook and the Zuck himself are being sued over the IPO, according to a slew of papers filed in the U.S. District Court in Manhattan Wednesday morning.

At issue are material reductions in the company's revenue forecasts that were selectively disclosed to preferred investors as opposed to the investment community at large, as required by securities law.

Also at issue is the fact that a single Facebook executive may have communicated this information verbally to institutional investors but, again, not to every investor. That's a big no-no.

Talk about irony, though.

Facebook represents itself as ushering in a new era of transparency, openness and connectivity. If these allegations are true, the company could not have been more two-faced.

I've been involved in Wall Street and its IPOs for more than two decades and I have never seen something like this. It's unprecedented, especially when it comes to material revenue projection reductions during the company's pre-IPO roadshow.

So far individual investors are just getting warmed up.

Phillip Goldberg, for example, filed a complaint in Manhattan federal court against NASDAQ OMX Group, Inc. saying the exchange acted negligently in its widely publicized mishandling of the Facebook IPO.

Goldberg, who is based in Maryland, apparently wants to represent a class action lawsuit on behalf of investors who lost money because their orders were not properly handled.

The bottom line?

I'd love to buy Facebook put options. But I can't. There aren't any and estimates suggest there won't be any made available until May 29th at the earliest.

I'd also love to short Facebook stock. But I can't do that, either.

My broker tells me the stock is on the restricted list, meaning the security cannot be borrowed nor delivered in such a way to consummate the transaction.

So, I'll just sit back and watch the fireworks for a while.

Come to think of it, $7.50 a share is still rich for a company that doesn't know what it wants to be when it grows up.

Related Articles and News:

Join the conversation. Click here to jump to comments…

About the Author

Keith Fitz-Gerald has been the Chief Investment Strategist for the Money Morning team since 2007. He's a seasoned market analyst with decades of experience, and a highly accurate track record. Keith regularly travels the world in search of investment opportunities others don't yet see or understand. In addition to heading The Money Map Report, Keith runs The Geiger Index, a reliable, emotion-free guide to making big money and avoiding losses, and Strike Force, which aims to get in, target gains, and get out clean. In his weekly Total Wealth, Keith has broken down his 30-plus years of success into three parts: Trends, Risk Assessment, and Tactics – meaning the exact techniques for making money. Sign up is free at totalwealthresearch.com.

Read full bio

  1. ChowT | May 25, 2012

    You are too generous. Feaces Book has no intrinsic value. Just a passing fad.

  2. Armin Brack | May 25, 2012

    Sorry, but 7,50 $ is ridiculous. Facebook is sitting on 13 billion dollars cash with no debt. At 20 billion dollar market cap operating business would be valued at a meager 7 billion dollars. Facebook made 1 billion dollar net profit in 2011 alone and is still growing at at high pace. So do you really think a 2011 PE-Ratio of 7 would be a fair value for a company who just starts tapping the potential of 900 Mio.+ users.

    • Dave | May 25, 2012

      Facebook doesn't have 900 million users for starters. That is a make believe figure based on flawed data (search Money Map press for an explanation). Like the accounting irregularities that forced a delay in going public, FB has trouble doing their books without using their imagination!
      Consider the insiders who are just waiting (apparently not all waiting!) for their lock-up to expire so they can dump more shares on the market. One of the primary reasons companies go public is that the early profits or expectations of same have been reaped.
      Ignore the fact that barriers to entry are low enough, remember FB is not the first big player in this space and its primary user is young & fickle.

    • Michael | May 25, 2012

      Armin,

      Get you math straight, Facebook is sitting on $3.91 billion in cash as of March 31,2012. – not $13 billion. Also, a price target of $7.50 makes its PE ratio 17.44 based on its current $0.43 a share of earnings.

      (http://finance.yahoo.com/q/ks?s=FB+Key+Statistics)

      • Armin Brack | June 7, 2012

        You forgot the money they got from the IPO, Michael…but I wasn´t quite right, too. It is
        Net 6,84 Billion $ Cash from the IPO + 3,91 Billion $ Cash before the IPO = 10,75 Billion $ Cash
        and they made about one billion after tax in 2011. Conservatively that means another 20 billion $ Market Cap, when you think Facebook will have only moderate growth. So, the low end of the fair value range would be 30,75 Billion Market Cap. / 2,7 Billion shares = 11,39 $

        By the way: The P/E-Ratio of AMZN is 181 (TTM). Should they also trade at a P/E-Ratio of 13 or 18? This would mean a fair value of 18,23$ instead of 218$, right? In Germany they call this a "Milchmädchen-Rechnung"…

        Let´s make a bet, Michael: I say, one year from now stock price will be at least 15$, that´s twice what Fitz-Gerald says. You say 7,50? What are you willing to bet?

    • swiss | May 25, 2012

      wow… 900 million + .. you kidding right… i had 5 profiles, just to play mafia wars,
      people who play pets have 25 profiles, maybe more. people spend hours not using facebook but playing games, But Zinga is such a twat, I stop playing games, now i have only 2 profiles, but many still play and pay that Idiot zinga real money, that is going to stop, people who need brain surgery, will soon im sure stop paying Zinga real money soon, then the time people spend on facebook will go down a lot,,
      as for how many real accounts real people have, in facebook, its no where near 900 millions.. Armin Brack, u r a dreamer.. Fair value for facebook right now, 8 X income,
      the banks ripped everybody again, and all the greedy suckers just fall again. Wall street is a very dangerous place and no way can you trust 1 word that comes out of wall st NO WAY… Stealers, MF globle, oh, the list just too long..

    • Ed Tuler | May 25, 2012

      How does Facebook have 13 Billion in cash when they only made a profit for the first time last year and the profit was only 1 Billion?

    • Dhilon Foulkes | May 26, 2012

      @Armin Brack If Facebook has so much cash then why did they need to have an IPO?

  3. Stucito | May 25, 2012

    Can i LIKE this enough

  4. CP | May 25, 2012

    YAWN!!!

  5. doug maenpaa | May 25, 2012

    I totally agree, I did a similar calculation, with similar reasoning, and got about $7.50/share.

    Right from the outset, I was totally amazed at the muppets that were buying this stock.

    I read about a person, who bought 20 shares initially, and , because he couldnt stand the volatility, sold out for a 10% loss. Nothing like having a little "skin-in-the-game" , to teach a valuable lesson- this guy is very fortunate ! Cost of the lesson, $200.00 , value of the lesson: priceless !

    The bloodletting is just beginning, I bet Morgan Stanley takes it on the chin big-time.

    Doug Maenpaa

  6. JOHNSON TRENT | May 25, 2012

    THE BIG PROBLEM ABOUT FB IS , THAT THIS COMPANY IS STARTING THE ABUSE OF THE PERSONAL CONFIDENT & SECRET INFORMATION PROVIDED BY THE USERS IN A NEGATIVE WAY , COMMON IN THIS MODERN AND DANGEROUS WORLD WE DON'T WANT EVERYONE OUT THERE , TO MISS USED THIS . iT'S AS ALMOST EVERYONE WHO'S ON FB OR ARE USING IT , ARE MARKED BY THE BEAST , EXAMPLE 666 AND ARE BEING HYPNOTIZED BY THIS SOCIAL NETWORK ACTIVITIES , IT'S SEAMS LIKE ONE'S COULD NOT GO ONE DAY WITH OUT BEING ON LINE ETC…. AT FIRST IT WAS FUN , BUT NOW IT'S GETTING DANGEROUS, AND IT'S ENTERING OUR LIVES , IN A VERY SNEAKY MEAN WAY .
    ONE THING I CAN SUGGEST , BE VERY CAREFUL IN WHAT CONTEXT YOU SHARE YOUR PERSONAL INFORMATION WITH OTHERS ON FB , NOWADAYS ONE COULD NOT BE CAREFUL ENOUGH . NEXT THING WE'LL ALL BE CAREYING A INSERT CHIP ,THAT THE FBI,CIA INTERPOL & THE GOVERNMENTS OF THE WORLD ETC… WILL DOMINATE & DICTATE OUR LIVES , HOW TO ACT , WHAT TO DO , HOW TO BEHAVE , WHAT TO THINK , WHAT TO SAY , EAT , READ , BUY ETC….. ETC….. THIS WORLD IS GETTING VERY DANGEROUS INDEED AND THE MOST SCARY PART OF IT : THAT WE DON'T KNOW WHERE IT WILL END . LITTLE BY LITTLE WE ARE TURNING IN TO MODERN ROBOTS & SLAVES ( ALL PROGRAMMED ) BY A CHIP & MARKED BY THE BEAST ! SOMEONE IS ALWAYS WATCHING US 24/7 ( SECRET GOVERNMENTS ALL OVER THE WORLD ) AGAIN BE VERY CAREFUL PLEASE .

    • swiss | May 25, 2012

      dont ever put your real data ,,, never.. i put false name, D of B, fake everything,
      my profile pic is roger rabbit.. only a complete fool would give them their real name,
      do people really put correct info >>> kidding right,,
      i do say i am a male, thats as close as they get to my real ID. apart from my IP address

    • Surf Rover | September 8, 2012

      Hi Johnson

      An interesting contribution to the blog. It would be nice if you could use 'upper case & lower case letters' as almost everyone else does.

      I found it hard to digest your contribution, not due to it's 'content' but trying to work it out what your message was all about.

      Surf

      Surf Rover

  7. BJPL | May 25, 2012

    Face it! The greed factor caused the usual "blind eye" to market reality. Now that FB is fully in the public eye of the investment community, their fate will be determined by the free enterprise system. Hopefully, no one will assume that they are too BIG to fail!

    Other innovative options to FB are already under way. Watch for the real monetizable ideas that will come with tech & comm. FB will have to face the music of real competition for advertiser dollars.
    Enjoy the ride!

    • swiss | May 25, 2012

      BJPL… it was market hype…. propagada by wall street banks….
      its that simple, the bankers party again this week :)))

  8. Larry | May 25, 2012

    I have to agree with the conclusion of the piece by Keith. Facebook may be a great way to keep up with friends but I don't think it is not a good way to advertise. If most are like me, they ignore ads. I shop for what I want or need when I want or need it.

  9. Joe | May 25, 2012

    Ya, its probably between 5 to 7 a share, give it a month. People got Zucked big time

  10. H. Craig Bradley | May 25, 2012

    VORTEX

    Yep, I agree we have a social (market) problem and its sure not just Facebook either. Notice how being merely popular is enough to get you in business or elected? Fundamentals are still relevant, but just not to the mass of investors or voters. Everyone gets pulled into a kind of "vortex". The results are best described by Keith: "Gamblers Ruin". This principal can apply to a whole society or country too.

    You see, its not just a single instance or merely just a "few miscreants" anymore. Its not just JP Morgan Chase and Jamie Dimon. Instead, its become pandemic and systemic. We are chasing the illusive "easy money" and in the process, are likely to be fleeced by every con artist, U.S. BANKER, and politican for years to come. Don't blame the Chinese.

    It will continue until the country and its investors, or most of them, are flat broke. We should be building for the future, not gambling away our inheritence like a drunken wastrel.

  11. david tarbuck | May 25, 2012

    I write this as a disgruntled "user" rather than a (potential) shareholder.

    I signed up for a "page" on facebook because it seemed to be a way that some "friends" might be in contact who might otherwise not do so.

    However when I used 'another computer" (as I am doing here) they raised the alarm and demanded a lot of nonsensical information.

    As I gave them the correct password to begin with I consider it NON OF THEIR BUSINESS whose computer or where it is, that I am using.

    Accordingly I told them where to headin at and have NO more use for "Facebook"

  12. H. Craig Bradley | May 25, 2012

    VORTEX

    Yep, I agree we have a social (market) problem and its sure not just Facebook either. Notice how being merely popular is enough to get you in business or elected? Fundamentals are still relevant, but just not to the mass of investors or voters. Everyone gets pulled into a kind of "vortex". The results are best described by Keith: "Gamblers Ruin". This principal can apply to a whole society or country too.

  13. H. Craig Bradley | May 25, 2012

    You see, its not just a single instance or merely just a "few miscreants" anymore. Its not just JP Morgan Chase and Jamie Dimon. Instead, its become pandemic and systemic. We are chasing the illusive "easy money" and in the process, are likely to be fleeced by every con artist, U.S. BANKER, and politican for years to come. Don't blame the Chinese.

    It will continue until the country and its investors, or most of them, are flat broke. We should be building for the future, not gambling away our inheritence like a drunken wastrel.

  14. H. Craig Bradley | May 25, 2012

    FINANCIAL ADVICE FROM Mr. T

    Mr. T (Lawerence T. ) of the 80's television series "The A-Team" would say regarding Facebook:
    " Watch Out Sucka "

  15. dordan | May 25, 2012

    where are all the straight people in this business

  16. W.L. Wigginton | May 25, 2012

    Upon reading this article I found this information to be a little off. After drawing all the numbers an taken many factors into consideration, facebooks value, per share, is around $3.67. I just bought 20,00 shares because in two weeks facebooks value per share is going to skyrocket to…wait for it….$112.37! You do the math. True story.

    • H. Craig Bradley | May 25, 2012

      You must be smok'in Peyote. I sure won't be "wait'in for it". You wait and YOU do the math. Moron!

  17. E. Tamasese | May 25, 2012

    Probably right on the valuations of the shares but I think the value as an advertiser is well… undervalued. Works very well for my needs.

  18. robert | May 25, 2012

    I thought too many people had visions of Google plums dancing in their eyes.
    But the fraud perpetrated by FB (perhaps) and MS and GS (apparently) in connection with the offering is shocking.

  19. Suk | May 26, 2012

    Yes, face book cant be valued any way near MS, Google, or Oracle or any other tech company that sells technology. FB is offering something and we may choose to ignore it if it annoys you. You can sign off all the likes, you don't look at the advert when you look at your friends or other social activities. Any one who like something is not supposed to buy it, thats why GM and other brands will pull out. Coca cola is affordable for any one and it may continue with FB, even though not doing so will not hurt them. FB is not a selling machine that sells something or technology. Its simple that it cant have a value that is anyway near tech companies. Even a gaming company can be bigger than FB since its sells.

  20. roe01957 | May 26, 2012

    I did not recieve private briefing e-mail all last week

    • admin | May 28, 2012

      Afternoon,

      You will find that you will still be able to receive it in your dashboard. We are dealing with some deliverability issues currently. We hope to have them fixed very soon.

  21. Andrea | May 26, 2012

    Thanks Keith for that colorful, yet very educational overview of this cluster**ck. That was hilarious and this will be my go to link for anyone asking me to explain what's going on.

  22. Kpac22 | May 27, 2012

    Bought siriusxm 6 years ago at 6 a share thinking I would be set up down the road. Come on, with 10 plus million subscribers at 13 bucks a month? Well, today at less than 2 bucks a share I would have advised those throwing their savings into facebook to go to Vegas and put it all on black. It's a rich man's game this whole stock market thing, just wish I was smart enough to get into finance instead of healthcare. Good luck to those who bought in at 38.

  23. King Ralph | May 27, 2012

    The problem with Facebook is that it's imperious leader Mark Zuckerberg screwed anyone he needed to in order to get where he is. Screwing the public with the stock offering was his ultimate Suckerberg. His net worth will drop with the stock but he still cashed in a billion at the offering.

  24. Stephen Williams | May 27, 2012

    The Facebook Debacle – More Undisclosed Insider Secrets

    BREAKING NEWS: Facebook’s Mobile Woes Just Got Bigger

    Leader Technologies is awarded the patent on social networking apps after a 10-year USPTO evaluation

    READ MORE….WWW.DONNAKLINENOW.COM

  25. John | May 27, 2012

    My own analysis has been different. $3.50 – $4.00 if you are optimistic and believe Mr. Zuckerbergs specified user numbers, around $.40 if not.

    • Doc Lost in Zuckerville | June 1, 2012

      so would you say that an any price right now FB is a sell? If you had purchased it, would you be selling at the current price or wait it out?

  26. anjani kumar | May 28, 2012

    I get a feeling that the retail investor participation is next to Nil & the scavengers of wallstreet are short on the fb stock…hence the negative talk to tank the stock & gain…mark made his big money with the ipo irrespective of the talk…Guys,stay away from the stock market forever…its a rigged racket in favour of Big Money!

  27. Veronica | May 28, 2012

    When facebook popped up I wondered was it worth joining – didnt bother – then after a couple of years lots of people I know and my relatives all started using it – I still didn't bother – I can get in touch with everyone via my email what do I want to join this other thing for – still havent joined – I considered it altogether too nosy and personal – it rang all my 'watch out' bells somehow – so now I am very glad my instincts won again – they generally tell me what can't be trusted !!
    After all why are they running this thing – isn't it obvious it's to get all your information in one place so they can then USE it ???

  28. Veronica | May 28, 2012

    to add to my above comment – consider everything that's offered free – credit reports for instance – yet another simple way to combine information about you into a database ( and you gave them permission to get it ! ) – once these sites buy each other out or collude together, or are co-opted by the government, there will be no such thing as privacy of ANY of our information to the highest bidder – it's probably already too late anyway !

  29. Doc Lost in Zuckerville | May 29, 2012

    I know very little about the stock market, but my brother is a financial advisor and recommended that I buy some FB to "get in" on it early. I bought at 38.70 with a portion of my IRA and have been bleeding since. What do you advise for those of us who did buy? Should I sell as soon as possible?

    • Michael | May 31, 2012

      Fire your brother – he got zuckered along with the rest of the sheep.

    • contrarian | September 17, 2013

      My advisor told me the same thing, and I bought a sizable chunk at $35. It tanked immediately and never resurfaced until very recently. I kept seeing dour reports on its negative prospects, but I was determined to hold. Which I did, until today, when I sold it all for $45/share. Hope you hung on, as well.

  30. George | May 31, 2012

    The wording of this sentence is a little confusing–

    If we use Google's price to sales ratio of 4.9 (and I am being generous here for discussion purposes), that equals a total market cap of $20.24 billion or 76.68% lower than where it's trading today.

    Kind of sounds like you're talking about Google. But you're talking about Facebook.. right?

  31. ronnel lacson | June 2, 2012

    Why do people still fall for the same scam? A simple common sense and buffetology is enough to earn big bucks in stocks.

  32. ronnel lacson | June 2, 2012

    @ George… He uses google price to sale ratio instead of a smaller p to s of Apple; thus he claim to have been generous in calculating for facebook's value

  33. lex | June 5, 2012

    They estimated 104 bil when the artical was rote it was 86. He said give it a month it's been 11 days and it's down to 57.51(didn't wanna call it 58) and its 26 a share

  34. Arpit | June 7, 2012

    The 13 billion cash that was being talked about was after the IPO.

  35. Frank V | June 7, 2012

    At $7.50 per share you are being generous! I would have put it at $3.80 tops. There was stated somewhere that I company is losing revenue. Facebook made money?? The small amount of ads that they do have, I was surprised they made anything. I thought to be in NASDAQ you had to make money, and a lit of it. Facebook was not a money making venture (at least what I saw), why was it ever offered, and why did people buy it? I say to those who bought it…what happened to your common sense??? Oh, it was just greed!

  36. Mike k | June 8, 2012

    I don't understand why everybody is upset? It's not like anybody was FORCED to buy Facebook stocks at the IPO price. I say kudos to Zuckerberg et al., for bringing a product to market that was in demand and getting a price that seems to be pretty close to the top of what was the range they could ask. Is this extraordinary? Heck no. If you don't believe me, then ask yourself why is it acceptable for toy companies to charge exorbitant markups at Christmas time for the latest and greatest fad/flash on the pan toys to put under the tree for the young ones? Is this not an example of free enterprise working?

  37. Cathy | July 27, 2012

    Blame it on Bush , I wonder if the trillions of printed Ben B money went into this to help the GM and all the banks with FREDDIE ETC. Don,t worry the Senate will fix it and remember they have not had a budget in over three years, to late to cry with all those hopes coming for this is Christmas for many attorney's what a present and the media takes in some news $, what more could you want IBM pulling there ads for expansion of this technology, what do they say when everybody is running to get a new product and break through the doors and trample over everyone,go the other way and watch the news on FB they will tell all there LIKES!

  38. RICK BIRARDA | August 16, 2012

    Facebook stock is LIKELY headed for $15 US very soon…AFTER THE 11% DROP OVER THE PAST TWO DAYS

    I wouldnt doubt it will hit below $10 befor December 2012 …more in line with the realistic $7.50 valuation suggested by others on this site

    NOT SURE I WOULD INCLUDE IN THE CHRISTMAS STOCKING EVEN AT $7.50 A SHARE

  39. Mike | August 7, 2013

    Wow! how does it feel to be off by a factor of 5! P/E of 50 or so is not so ridiculous for a company that had its IPO just more than a year ago. FB is here to stay. Whether it will become a Google or Yahoo it remains to be seen. With the current market dynamics, I think FB is a buy below $30 and a sell above $35.

  40. Shawn Green | August 8, 2013

    Hope you are going to revisit this post and say you were dead wrong. FB is at almost $40 a share as of today. Hope you didn't short them.

  41. contrarian | September 17, 2013

    I bought the secondary market shares through Elm Street at $35 and watched the price plummet to a low of $17. That was in February 2012. Earlier this afternoon I sold the lot at $45.

    Articles like this one gave me heartburn while I waited, waited, waited.

Leave a Reply

Your email address will not be published. Required fields are marked *


seven × = 42

Some HTML is OK