The following video is part of our "Motley Fool Conversations" series, in which Chief Technology Officer Jeremy Phillips and senior technology analyst Eric Bleeker discuss topics around the investing world.
Despite continuing analyst price targets pushing past $40, Facebook has seen its share price sinking like a stone recently. Eric and Jeremy look at where a baseline for Facebook might be. The company has $7 billion in cash to work with, and Eric points out how the company's P/E isn't reflective of its current earnings ability as the company, as Facebook has purposefully held back on using more real estate on its site for advertising.
In the end, neither Eric or Jeremy would buy Facebook as a display-advertising company, or even one with a payment platform. However, while Jeremy says he'd never buy Facebook until it proves it's not just a display-advertising company, Eric says he'd become extremely interested in Facebook below $20 on the promise of steps it could take to create more meaningful advertising. To see their full thoughts, watch the video.
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