Tuesday, August 27, 2013

Facebook Valuation

Speculators are valuing facebook as a more-than-$100 billion-worth company, based on a $53 million profit last year.

Facebook has an estimated P/E ratio of about 60 (or 193 for ttm). People are willing to pay for 60 years of forward earnings in order to buy a share of their stock.

Using this kind of valuation, Apple will be worth something like $3 trillion.

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