$300B! Facebook just passed up GE

Watch out Warren Buffett. Mark Zuckerberg is on your tail. Following Facebook’s (FB) better-than-expected results Wednesday, the No. 1 social media company is now worth $306.7 billion. That not only puts

Sourced through Scoop.it from: www.usatoday.com

Following Facebook’s (FB) better-than-expected results Wednesday, the No. 1 social media company is now worth $306.4 billion. That not only puts Facebook’s market value ahead of General Electric(GE) at $299.6 billion – it makes Facebook the seventh most valuable company in the Standard & Poor’s 500. The next company Facebook is poised to overtake is Amazon (which it had briefly exceeded in value during the day) then famed investor Warren Buffett’s Berkshire Hathaway, valued at $336.5 billion, says S&P Capital IQ.  The remarkable rise in the value of Facebook is a stunner. The company has shaken off early doubts about its longevity around the time of its initial public offering in 2012. Facebook shares suffered in the months following the IPO. But since then, the stock has been a home run. Facebook stock was first sold for $38 a share. Thursday it closed at $108.83 a share for a 186% gain.  There’s no question that Facebook is not a cheap stock, as shares are trading for more than 100 times its diluted earnings over the past twelve months. That’s a nosebleed valuation even for a company that’s expected to grow by roughly 30% a year over the next few years. But it’s not just a speculative bubble – as the company isn’t just a story – but a real profit machine. Facebook has generated net income of $2.8 billion dollars on revenue of nearly $16 billion over the past twelve months. And it’s expected to continue to grow rapidly. Analysts are calling for Facebook’s adjusted profit to jump 22% this year and 31% next year, says S&P Capital IQ.

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