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Even their valuation is based on some very high growth rates. If their growth rates drops the stock would tank.
by samfisher83 10y ago
Even their valuation is based on some very high growth rates. If their growth rates drops the stock would tank.
- jonknee 10y ago> If their growth rates drops the stock would tank. Which is the case for literally every publicly traded company.
- samfisher83 10y agoFB FCF is roughly 6B their cap is 370B. That is 60x of FCF. Most companies aren't that extreme. If there was a slow down in Growth their fall would be much larger then a more mature company because a majority of their valuation is based on growth.
- jonknee 10y agoThere is no denying FB is priced for growth, but it's growing like crazy while the rich valuation is coming down. Your $6B FCF figure is from last year and they are blowing that out of the water so far this year (+60% in the first 2 quarters). It's not fair to use today's stock price with last year's cash flow and decide that it's extreme.