4 ms·
> If a stock is priced at a huge multiple to earnings and sales... FBs P/E ratio was well into the value stock territory of ~22 before this dip. They were trad
by skizm 5y ago
> If a stock is priced at a huge multiple to earnings and sales...
FBs P/E ratio was well into the value stock territory of ~22 before this dip. They were trading at the lowest multiple of any other big tech company by far, now they're even more insanely undervalued from a fundamentals perspective. I realize that doesn't matter in the age of the meme stock, but personally I'm still pretty bullish in the long term and that's assuming the XR stuff is just a giant money furnace and returns nothing.
- idoh 5y agoAgreed. I was looking at them even before this dip. They are valued so low that even if they simply maintain current earnings relative to inflation they are an OK investment.
- onlyrealcuzzo 5y agoFor reference the S&P average P/E is ~25.96. FB at it's worst is growing much faster than average, it's balance sheet is healthier than almost every other company beside MAAG, and yet it is valued below average.
- pembrook 5y agoAlso for reference, the entire rest of the world outside the US has an average P/E of 14.5 right now. Make of that what you will. Also, re: the parent comment, a P/E of 22 would traditionally never be called "value stock territory"...whether or not that valuation is too pessimistic about Facebook's growth prospects.
- grey-area 5y agoThat PE means it is grossly overvalued, concentrated in a few large tech companies. Saying pe 22 is value territory just illustrates the massively distorted current market. Historically, around 15 is the mean, not 25 https://www.multpl.com/s-p-500-pe-ratio https://www.multpl.com/s-p-500-pe-ratio