$13.80 Here’s a fair-price calculation for Facebook
Facebook’s stock should trade for $13.80
Commentary: Here’s a fair-price calculation for Facebook - . So, in order to entice someone to invest in it today, Facebook needs to offer a handsome return. Assuming that its five-year return is equal to the stock market’s long-term average return of 11% annualized, Facebook shares currently would need to be trading at just $13.80.
Nice try but wrong. The real fair price would be an even $13.00 a share. Alas we are dealing with a Nasdaq stock.So people give it a higher value. Hence the jump to $45.00 at the start.Which was overdoing it way to soon and hence got a strong drop down to $17.55 before it jumps in reverse up to $28.88 today.Cuffs