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> Facebook's current share price basically values it as a utility already Market cap is a measure of investors' beliefs of a company's future free cash flows.
by traek 8y ago
> Facebook's current share price basically values it as a utility already
Market cap is a measure of investors' beliefs of a company's future free cash flows. Regulated utilities have capped profits, so their valuation tends to be lower. Facebook absolutely does not have the valuation of a utility. Name a utility with a market cap of 400 billion USD (hint: the largest electric utility in the world has a market cap of $86.16 bilion).
- nkingsy 8y agoDuke energy and Facebook have identical P/E ratios. Don’t have time to dig deeper but given that I don’t see regulation destroying shareholder value, the market sees them on a utility trajectory going forward. Edit: name a utility with a global monopoly.