Facebook To Be a Trillion Dollar Company?

Discussion in 'Stock Market Forum' started by Rainman, Nov 24, 2015.

  1. Rainman

    Rainman Senior Investor

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    It's far from there at the moment but there's speculation that Facebook eventually will be worth over $1 Trillion. With such growth potential it does look like seem like buying FB stocks and holding would be a good strategy that will prove profitable if you are patient enough?

    http://www.fool.com/investing/gener...es-that-could-beat-apple-to-a-1-trillion.aspx
    With sales expected to more than triple from $12.5 billion in 2014 to $38.6 billion in 2018 and Facebook regularly surpassing Wall Street's prognostications, it's not hard to imagine the company commanding a premium valuation for years to come. Perhaps even $1 trillion, in due time.
     
  2. pwarbi

    pwarbi Senior Investor

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    With Facebook it seems that no matter what people say or try and throw at it...it's losing members, people don't use Facebook anymore...they keep going from strength to strength.

    If a person wants to invest in the social media market then with those figures it does look like Facebook is the one to go with and would be a shrewd decision.
     
  3. petesede

    petesede Guest

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    It will take a major privacy issue for Facebook to fall at this point. Everyone uses it already, which by itself is not really a good thing for ´growth´. But what is fueling the stock price and revenues is that Facebook is getting better at presenting and delivering ads, which is one of the things that fueled Google 10 years ago. You can have the exact same number of users, but if you are able to make your ads more effective, then you are going to grow revenues. I spend a good deal of money on buying ads, and Facebook is getting to the point of being almost as effective of an ad buy location as Google. Facebook already has more traffic than Google, but if they continue to refine their ad delivery system, yeah, they should hit a trillion.
     
  4. JR Ewing

    JR Ewing Super Moderator Staff Member

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    WAAAY overpriced at this point IMO. Of course that doesn't mean it won't perhaps keep going up for at least a while longer, or at least hold its ground for a while. I'd expect the similar-sized Amazon with ~7.5 times more revenue to hit a trillion well before them, but you never know. FB is growing faster on both bottom and top lines these days.

    If it survives longterm, I suppose it could eventually hit a trillion, just like a number of other companies will eventually. But I don't think it's likely to happen in say a year or 2. I believe that many of these companies with very high valuations and little or no earnings are rather "bubbly". My best guess would be that Amazon would be more likely to hold much of its ground than FB, NFLX, TSLA, etc among all of these if we see another tech crash - especially since AMZN is really more of a retailer than a tech co.

    I think Apple's consistent very strong earnings and sales, and large stockpile of cash make them a good candidate to be the first trillion dollar company. I'd put google second.
     
  5. Onionman

    Onionman Senior Investor

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    It's not the stock it was in terms of growth potential and opportunities, in my view. I know that there's still a big untapped market in parts of the world that aren't fully open to FB (e.g. China) but all the very low hanging fruit has been got and to continue with such a high growth trajectory they'll need to keep shifting ways to monetize.

    And it's not as if it's the only game in town in the social media space either. We'll see how this one plays out but I wouldn't be one sticking money into it with a 5-10 year view.
     
  6. pwarbi

    pwarbi Senior Investor

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    As a long term investment I agree and I can't see investing big now as a way to make a profit in 5 years time for example as I think the price will be at its peak at the moment.

    That isn't to say it's not a good investment for the ones who want to make a quick, small profit, but that's not something that I'd be interested in.
     
  7. ScooterBrandon

    ScooterBrandon Senior Investor

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    The industry is just so fickle it's hard to predict if it will stay relevant or not.
    Kids are actually moving away from Facebook towards other social media like Instagram, Yik Yak, Tinder or snapchat.
     

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