They're worth a hundred billion... three or four years post IPO, and if they don't screw it all up. As an investor, they're not worth buying at a hundred billi

They're worth a hundred billion... three or four years post IPO, and if they don't screw it all up. As an investor, they're not worth buying at a hundred billion. There's little to no value upside over the next five years (value, not price; value being what you get, price being what you pay), short of a stock market bubble spiking everything. It's not surprising FB would get a $100b valuation though. Investors are desperate for growth. Compression is a word FB investors should get used to. Facebook will spend years growing into that valuation, much like other tech stocks in a similar outsized valuation situation. Google for example has returned a weak 6% per year for the last five years. Not much greater than the dividend that Verizon and AT&T pay. eBay has spent a decade growing into their crazy dotcom days valuation, and now sport a very modest 15x pe ratio. At $8 billion in sales, FB can generate $3 billion in net income. Their model scales extremely well in terms of margins and expenses per extra dollar of sales/profit. At $3 billion in net income, they'd have a 33 pe ratio. They can absolutely hold a valuation around those levels three years out. This is assuming their sales growth continues to slow. However, point being, there's no value upside left in the stock.