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Renowned Valuation Expert Professor Aswath Damodaran Says Facebook Is Worth Buying Now
Posted by: Dheeraj Grover (IP Logged)
Date: August 23, 2012 12:23PM
Aswath Damodaran, a professor of finance at New York University, and author of well-known value investing book, "The Little Book of Valuation" was on CNBC to discuss his views on Facebook, its business model and current valuation and his estimate of Facebook (FB)'s intrinsic value
-- Facebook is worth buying at these prices.
-- He thinks Facebook has an intrinsic value of about $24.
-- Has great potential in terms of monetizing the huge base of its members.
-- Worried about corporate governance and management's capacity and capability to pull this off and overhang of huge number of shares waiting to come to the market.
-- Facebook is surely a risky investment, but it is a good long-term bet at $18 or so.
Here is the video:
Re Renowned Valuation Expert Professor Aswath Damodaran Says Facebook Is Worth Buying Now
Posted by: Adib Motiwala (IP Logged)
Date: August 23, 2012 05:38PM
Given the downside risks due to over valuation, even a 33% upside ( from $18 to 24$) does not seem like enough of a risk-reward to consider this as an investment. If he thinks $24 is fair value, I would think $12 may be interesting. Need a 2x on something that has negative momentum, insider selling, slowing growth, high valuation going against it....