Facebook Inc (FB): A Terrific Business, A Middling Stock


Back in 2012, Facebook Inc (NASDAQ:FB) stock was not trusted by most of the investors and the company started to face trouble after its birth in the public markets, but soon, the social media company became a giant. But an article on Fool said that there are some experts and analysts who doubt that Facebook Inc (NASDAQ:FB) stock will continue to be the juggernaut in the markets. The source quoted an investor, who thinks that there is nothing wrong with Facebook Inc (NASDAQ:FB) business, the problem is with shares and the valuation of the company.

The source compared Facebook Inc (NASDAQ:FB) with Google and said that the social media company’s valuation of $232 billion if coming close to that of Google’s in a very short period of time, and this makes its stock risky. The article said that Facebook Inc (NASDAQ:FB) business is perfect, but its stock could leave investors flat-footed at some point sooner or later.

Another expert said that the biggest threat to Facebook Inc (NASDAQ:FB) in the current scenario is the rise of apps. Each day, we see new apps targeting the customer base of young users. Snapchat is the biggest threat, having 200 million monthly active users. The source said that Facebook Inc (NASDAQ:FB) acquired famous app just to tackle the potential threat they had for Facebook Inc (NASDAQ:FB). But this strategy is acquisition could not work every time.

The third reason which makes Facebook Inc (NASDAQ:FB) even riskier is the elevation of its expenses and spending. An estimated rise of 70% in expenses is coming and investors must be on the guard before making any decision.

  Ken Griffin holds 4.58 million shares worth $307.87 million of Facebook Inc. (NASDAQ:FB).

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