Posted by & filed under Company Analysis, Growth & Valuation.

Description:   As the fateful day of Facebook’s initial public offering draws closer, the giant social network’s financial results are attracting more attention. And while its recently updated securities filing shows some blockbuster numbers—including a mind-boggling 900 million active users, half a billion of whom use the site daily—it also reveals some potential red flags, including rapidly rising costs for marketing and other expenses. All of this raises the question that investors will need to answer before too long: Is Facebook unlike anything we have seen before, or is it just another modestly profitable Web business?


Date: 04/24/2012


Questions for discussion:

  • What are the concerns related to the valuation placed on Facebook?
  • How would you go about financially analyzing Facebook?
  • What value would you place on the firm today?

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