Is FB a buy? Look back Google IPO USD40, now is USD600++

Posted by Kim Yap Lau > 2012-05-19 13:39 | Report Abuse

Is FB a good buy at USD30? Will it come? HOw Google sustain n grow the revenue in future? These are the question to be considered. Look at the link http://adf.ly/8hU3d Google PE ratio : http://adf.ly/8hURu Share your though....

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2 comment(s). Last comment by Mat Cendana 2012-05-21 10:28

Mat Cendana

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Posted by Mat Cendana > 2012-05-21 10:28 | Report Abuse

One thing that we should bear in mind is this: Facebook IS NOT Google. Or like it. FB and the underwriters - plus some analysts - highlight the *hope* that it could turn out to be like Google... hence the justification of the US$100 billion market capitalisation. Then there's the 900 million users. But what use is this if it can't monetise the huge number of users? Same as Twitter - huge user base but how to monetise?

Last Friday, investors seem to have doubts too. FB would have gone below the IPO price had the underwriters not supported the price. But how long can they continue doing so? My own opinion is this - the $38 price is way, way too high. Wouldn't be surprised if it were to drop to $20 in a few months, especially when the `lock up' shares come to the market. FB and the underwriters were too greedy pricing the IPO at its very maximum.

If one really wants to buy US tech stocks, what's there to dislike about Apple and Google? These company are already making big money and will continue to do so. Facebook? For now, there is only *the hope*.

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