Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, social networking giant Facebook (FB 0.38%) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Facebook and see what CAPS investors are saying about the stock right now.
Facebook facts
|
Headquarters (founded) |
Menlo Park, Calif. (2004) |
|
Market Cap |
$65.3 billion |
|
Industry |
Internet software and services |
|
Trailing-12-Month Revenue |
$5.5 billion |
|
Management |
Founder/Chairman/CEO Mark Zuckerberg CFO David Ebersman |
|
Trailing-12-Month Return on Equity |
0.8% |
|
Cash/Debt |
$9.5 billion / $2.3 billion |
|
Competitors |
|
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 38% of the 1,807 members who have rated Facebook believe the stock will underperform the S&P 500 going forward.
Just last month, one of those Fools, captainCruncher, succinctly summed up the bear case for our community:
Facebook's valuation rests on the company's huge user base, but the company still has to successfully monetize that user base. They may do that, but it won't be through advertising, which is the current plan. Google was successful with advertising because people use their service to search for things. Often, they are even actively searching for things to buy. People use Facebook to connect with people, and advertisements are seen as an annoyance during social time. Facebook may yet find a great way to monetize their platform, but they aren't anywhere close, and I believe investors will grow impatient before they get there.
