Facebook IPO watch.

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The-Noid

Diamond Member
Nov 16, 2005
3,117
4
76
alent1234 said:
facebook doesn't make money? then what's the $3.5 BILLION of revenue they have?
Click to expand...

Earnings would have been a better metric, but taken at face find me another company that trades at 23x last twelve months revenue with a market cap within 1/10 of FB.
 
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alent1234

Diamond Member
Dec 15, 2002
3,915
0
0
no fast growing company trades at 23x trailing earnings. facebook is at $1 BILLION net income on $3.7 BILLION revenue for 2011
 
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alent1234

Diamond Member
Dec 15, 2002
3,915
0
0
nobody values anything on trailing numbers. i used to get free access to a lot of wall street reports and all the models went 2 years out

half the mac blogs say apple should be trading at $1000 or some ridiculous price because their P/E is low
 
T

The-Noid

Diamond Member
Nov 16, 2005
3,117
4
76
alent1234 said:
nobody values anything on trailing numbers. i used to get free access to a lot of wall street reports and all the models went 2 years out

half the mac blogs say apple should be trading at $1000 or some ridiculous price because their P/E is low
Click to expand...

Use forward, I don't care.

Find me another company that trades at 5x the high consensus revenue estimate of 16B for FY 2016 within 1/10 the value of Facebook.
 
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dagamer34

Platinum Member
Aug 15, 2005
2,591
0
71
alent1234 said:
no fast growing company trades at 23x trailing earnings. facebook is at $1 BILLION net income on $3.7 BILLION revenue for 2011
Click to expand...

P/E is usually computed with earnings, not revenue. $104 billion on IPO day / $1 billion in earnings = P/E of 100x. You can see why most smart investors consider this stock to be stupidly overvalued.

Don't get me wrong, Facebook as a company made tons of money off the IPO to invest in themselves and buy other companies. And those who actually go to buy at $38 and sell at $45 got a nice profit as well, but if you held onto it or bought at $45, you got suckered.

In the long run, I see it coming down to $7-10, then increasing as they figure out how to actually make real money off of 1 billion users. Banner advertising is not the golden ticket though.
 
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alent1234

Diamond Member
Dec 15, 2002
3,915
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0
but has any fast growing company ever been at 20 some odd PE except when the stock price peaks? usually the fast growers are at 70 or so PE for years

not saying FB is a good buy now, but waiting for a PE in the 20's at current growth rates might mean a long wait
 
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Rudee

Lifer
Apr 23, 2000
11,218
2
76
I highly doubt you will see the stock surpass the $40 level ever again. I think it will be in the $20 range sooner than many anticipated. They issued far too many shares.
 
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Imp

Imp

Lifer
Feb 8, 2000
18,828
184
106
alent1234 said:
but has any fast growing company ever been at 20 some odd PE except when the stock price peaks? usually the fast growers are at 70 or so PE for years

not saying FB is a good buy now, but waiting for a PE in the 20's at current growth rates might mean a long wait
Click to expand...

... I don't know, you use the terms PE and infer on valuation...

But putting aside your zealous defense of Facebook, you come off as having no clue what you're talking about.
 
SSSnail

SSSnail

Lifer
Nov 29, 2006
17,458
83
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ITT: alent123 is butthurt because most sane investors know FB is stupidly overvalued.

Ask yourself this - when was the last time you bought something off FB? Or because of it? I alone had 6 accounts at one time feeding myself zenga poker money. I never used FB for any other purpose, and don't care for it. I can't imagine a day that I don't use Google. Therein lies the difference between a stupid fad, and a legitimate company.


Edit: Zuckerberg, is that you? I love your hoodie :wub:
 
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dagamer34

Platinum Member
Aug 15, 2005
2,591
0
71
SSSnail said:
ITT: alent123 is butthurt because most sane investors know FB is stupidly overvalued.

Ask yourself this - when was the last time you bought something off FB? Or because of it? I alone had 6 accounts at one time feeding myself zenga poker money. I never used FB for any other purpose, and don't care for it. I can't imagine a day that I don't use Google. Therein lies the difference between a stupid fad, and a legitimate company.


Edit: Zuckerberg, is that you? I love your hoodie :wub:
Click to expand...

One thing that really trips people up is the "1 billion" user account number, which we all know is bogus.

Facebook should really be much more worried about Twitter than anything else, because while companies claim to have active participation on their Facebook pages, Twitter has clearly integrated with media companies on a significantly higher engagement level. As stupid as it appears on TV, Twitter and tweets are mentioned far more frequently than posts on Facebook due to the shortness of the message (which adapts amazingly well to television).
 
SSSnail

SSSnail

Lifer
Nov 29, 2006
17,458
83
86
dagamer34 said:
One thing that really trips people up is the "1 billion" user account number, which we all know is bogus.

Facebook should really be much more worried about Twitter than anything else, because while companies claim to have active participation on their Facebook pages, Twitter has clearly integrated with media companies on a significantly higher engagement level. As stupid as it appears on TV, Twitter and tweets are mentioned far more frequently than posts on Facebook due to the shortness of the message (which adapts amazingly well to television).
Click to expand...
You know what's really funny? If you watch MSNBC The Closing Bell, today, they were talking about FB tanking and at the end, the audience was asked to share their thoughts via Twitter. :awe:
 
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