$15 / share is a fair valuation given Facebook's cash flow profile and top-line decelerating growth. Said back on 19th May (the day after FB's IPO): "asset ma

$15 / share is a fair valuation given Facebook's cash flow profile and top-line decelerating growth. Said back on 19th May (the day after FB's IPO): "asset managers [do is] look at Free Cash Flow to Equity, not Net Income. On a FCF to Equity valuation, FB IPOed at +220x. Even at a generous P/E or FCF/E ratio of 25x, Facebook's Free Cash Flow needs to go from $450m to $4,000m in the next 24-36 months. Do you think that is possible? After looking at their infrastructure needs I think not." http://news.ycombinator.com/item?id=4002988 http://news.ycombinator.com/item?id=4002988