FB P/E Too High? Really? Compare it to GOOG in 2004!
For example, Google's (GOOG) P-E ratio was a whopping 133 when it broke out above a 113.58 buy point in September 2004, not long after it went public. The Internet search engine went on to quadruple by January 2006, to a high of 475.11.
While FB's PE is not derived from GOOG's, your comparison is apples to oranges. GOOG's q2 revenue growth was 150% yoy not in the 50% area of FB. GOOG had a market cap of 34 billion not 94 billion. With all that, FB's PE of 174 is 30% higher than GOOG's which you stated was133.
GOOG's appreciation of share price was driven by a growth rate that was 3 times that of FB @ a cap that is 1/3 of where FB is now and a PE that is much smaller than FB's. The comparison doesn't give FB a derived value in the future of 4 times today's value.
FB is going to actually follow a curve based on what the current market assigns it and based on what type of growth they have.
I traded GOOG from the ipo on and it was some great times with fantastic runs. FB will do what it does. IMHO, I do not believe that FB can quadruple in 2 years. Its growth rate is not there.
Not yet, but its easy to see it won't be long .. television advertising is being replaced with social media, namely FB, and FB has the international potential that Google does not .. China is still in play for FB .. and mobile is the future and Google is struggling .. but going back to 2004, the growth rate isn't there in this quarter, but anyone can see that FB is re-writing the books on mobile, advertising, targeting and personalizing ads, video, information, and entertainment ... and revenue will follow to a degree unheard of at this point. Hence, a quadruple in the near term is very possible.