Not that it matters to him. He already got his big payday.
But at the IPO, the argument was that a $38 price was justified despite the fact that the company had never made any money, because when you project forward a year, they would be making plenty of profit to justify a $38 stock price.
Well, we're coming up on that year now and, while they have showed a little profit, their price/earnings ratio is a completely insane 1,700 -- that's about 100 times higher than the market average. For comparison, companies seen to have a high growth potential -- Google for example -- might have a P/E of 26-ish -- never much more than that. eBay is 27. Priceline is 27.6
And on top of that, there really isn't a compelling revenue model for Facebook. People just fart around on Facebook. Advertising placed on Facebook just isn't very effective. FB is counting on mobile ads to be their salvation, but I just don't see that ever justifying the kind of price they have today. Give it another year and the market will be really tired of waiting for this to develop.
Facebook, the next Blackberry (AOL, Prodigy, or name your favorite flash in the pan.)
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