It won't happen. Not because I'm not bullish (I am), but because at the time of FB's IPO, they were one year farther along than Google, which means open market shareholders get one less year of real growth - plus the shares were arguably priced for now, not a year ago. Look at both companies' revenues, earnings, market cap, etc on a year by year basis. Facebook right now, is roughly equivalent to Google in 2006. And because of the ratio of shares to market cap, 7.8 shares of FB is the same relative value as one share of Google. So FB is about where Google was when Google traded for $300. The collapse in share price after the IPO just backed up FB shares to where they should have been anyway when they were issued, but the current price is fair, all things considered and using Google as a case study. Google had the misfortune of having its hot streak interrupted by a massive recession, and arguably its growth (and everything's growth) has been hampered by the fallout from that. FB could get lucky and have its ascent coincide with some real, broad, economic growth. And then there's the so far unbounded potential of mobile and its 24/7 user engagement opportunities. And if all of that happens, sure, it can be a $300 or $400 stock in a decade. But shorter term, think along the lines of what Google's share price trajectory (divided by 7.8 or course) from 2005/6 onward looks like. That is the game we are playing here. It is a very good game, but keep your wits about you.
My question is: What is your basis for saying it will go to 100 by years end? Is it a guess? Based on the current trend from earnings, it can't happen. So for it to happen, the trend would have to increase substantially. Fundamentals do not support it going to that level. Historically, nothing like this has ever happened. No stock over 100 billion has doubled in a year.
I know you can say, "but ooooo this is Facebook". I understand that you are new to the market and it would be nice to see that happen. This is not realistic and there is risk in growth (they will need a substantial beat to keep going up so a lot of this rise will price itself into next earnings) so to protect your investments you can't throw all your money on one stock. Look at the chart and see how it has risen and look at the timeline. I am not trying to be mean but base your conviction on something realistic.....not a wish
benzilla999 .. First of all I am not new at this ! I see great possibilities for FB ..... and I can think of many more ways that they can be more profitable as I am sure many other people can also ! The name alone and the fact that there will be so many more users .... will help propel the share price ! Having said that .... I think your shoes are too big for you !
CMG went to about 500 and arguably it has about as much going on as this. If this becomes a "cult" stock it could.
GMCR Netflix etc....
PE doesn't matter. Just some vague concept of hyperbola.
But don't count on it. Hot money isn't all over this yet.