First, let’s compare Facebook to Google. I actually wanted to try to compare it to, say, a network television studio because both have “viewers” in some sense that advertisers are trying to reach. But networks also make money on the programs themselves (and syndication rights), whereas Facebook has no equivilant product it’s trying to sell.
So both Google and Facebook are huge online presences. Both are trying to achieve money almost entirely through ad click-throughs. Sure, Google’s expanding into Fiber/TV (yay Kansas City!), but I’m actually going to compare it from June 2011 as that’s a date where I’ve got a useable stat from.
Google unique users per month as of June 2011: 1 billion.
Google stock price in June 2011: 495-530. Let’s call it 515 average.
Shares outstanding: 322.67 million
Total value for Google: $166 billion
Now, whether you agree with this obscene number or not, investors did. Considering that, at that point, Google had been public for 7 years it was a pretty stable commodity. So let’s work backwards.
Facebook: 24 million unique visitors per day or 720 million per month.
$166 billion * .72 = $120 billion
Now, I’m going to halve that evaluation for a few reasons
- Google can target ads based upon keyword search. Facebook can’t, which leads to lower clickthrough rates
- Facebook as a business has yet to develop a clear path on how best to place ads or, more generally, just make money
So a $60 billion company valuation and 2.138 billion shares of common stock outstanding.
That’s $28.06 per share.
Is that in any way, shape, or form the way you’re supposed to go about figuring out valuation? Yeaaaah, probably not. But I think my estimate’s reasonable
So $28. Final answer. Locking in the vote.