A day after Facebook’s initial public offering, the company is now worth more than $105 billion. While many of us expected this, I don’t think we all truly understood what this number means. At $105 billion, Facebook is worth more than a lot of the companies you interact with daily, and rests on the heels of others.
So let’s spell it out! McDonalds, who has a pretty solid record of getting you to come back and pay for those Fries, “posted $27 billion in revenues last year and a $5.5 billion profit. Facebook made $1 billion on $3.7 billion in revenues.” Yet, McDonalds is only valued at $91 billion. Amazon, for all its’ prowess, is worth $96 billion. And the list continues with Disney, Visa, and Volkswagen at $78 billion, $92 billion, and $70 billion respectively.
Now of course it’s much harder to bank on future revenues from almost a billion users in the Facebook scheme, but we’re talking about some big giants here. On top of that, PepsiCo. is valued at 106.5 billion, with Coca-Cola at $167 billion, Wal-Mart at $212 billion, Google at $196 billion, Microsoft at $246 billion, and Apple at $496 billion. Yes, Facebook is not as big as some of those giants, but how long will it be? What will happen when they establish a proven model of sustained revenue? Whew!
Any thoughts on this? Madness or priced just right? Let us know!