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What: Shares of Facebook
So what: The report pegs Facebook's value at just $15, which doesn't appear to be derived from any model or estimates. Rather, the report just guesses that "perhaps only $15" is the right price. The article compares Facebook by traditional valuation metrics to much more mature peers like Apple and Google, saying those companies offer more compelling value.
Now what: Facebook is also very generous with stock-based compensation, which allows the company to partially veil those expenses by using non-GAAP figures that the Street focuses on. Mobile monetization is very much up in the air at this point for Facebook, and the report has little to no confidence that Mark Zuckerberg will be able to navigate that transition. Within the next couple months, Facebook will also see lockup expirations on shares following the IPO, which may add additional selling pressure on shares.
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Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Apple, Google, and Facebook. Motley Fool newsletter services have recommended buying shares of Google, Apple, and Facebook. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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