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**BipiewExifese** · 05-18-2012, 01:04 PM

from zh:

Last year Facebook had $3.8 billion in revenue, not profit, just revenue. We don’t know how profitable Facebook is because it’s a private company. Let’s say Facebook’s executive team is absolutely stellar and they have even better margins than Google with 27.5% (Google achieved 25.7% profit margin in 2011). That would mean they earned $1.045 billion in profit which would imply a P/E ratio of 95.7 and a return of only a little over 1% on your investment. That’s a pretty bad investment which does not even begin to keep pace with inflation.

05-18-2012, 01:04 PM	#7
BipiewExifese Join Date Oct 2005 Posts 378 Senior Member	from zh: Last year Facebook had $3.8 billion in revenue, not profit, just revenue. We don’t know how profitable Facebook is because it’s a private company. Let’s say Facebook’s executive team is absolutely stellar and they have even better margins than Google with 27.5% (Google achieved 25.7% profit margin in 2011). That would mean they earned $1.045 billion in profit which would imply a P/E ratio of 95.7 and a return of only a little over 1% on your investment. That’s a pretty bad investment which does not even begin to keep pace with inflation.
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