Friday, May 18, 2012

my two cents

Facebook, although it has plenty of growth left, is a relatively mature company. Current revenues are $4.25B. Will its revenues eventually hit $20-$25B, closer to justifying its IPO valuation, not sure, but I doubt that market will continue to expect that in the intermediate term future. Similar to what happened to linkedin, which has fewer competitors, I am whimsically predicting that the share prices will drop by 50% of its opening trading day high.

Facebook has been "priced to perfection". There are much greater chances for it to disappoint than meet expectations.