Facebook Inc. (NASDAQ:FB) seems to have truly reach a point in its development as a public company where it is about an enigmatic as it can be for $20 a share. There are those who think good days are ahead for the company, while others think they know everything they need to know about the company, and they’re looking for a priest to give last rites.
Maybe a precipitous fall in value will do that. Did everyone know everything about Facebook Inc. (NASDAQ:FB) when it opened on the markets at $38 a share in mid-May? Perhaps that’s why the stock fell so far – everyone knew what was going on and thought the company was overvalued. But now that the stock is nearly 50 percent less valuable than three months ago, you’ll be hard-pressed to find any consensus on whether Facebook Inc. (NASDAQ:FB) is now fairly valued, or is a bargain with tremendous “upside potential,” as scouts like to say about a raw athlete.
It seems that what Facebook Inc. (NASDAQ:FB) has become and what it hopes to be in the future, has been a stark contrast to what investors and analysts in the markets expect from their investments or publicly traded companies. Facebook clearly wants to make the world one digital commune where all reaches of the world can communicate and interact with each other, while those who invest in companies and analyze earnings reports want to see profits reach to every corner of the world. As one article writer put it, “The fatal flaw in Facebook is that it wants to cash in on something that never cost money before in human history, friendship.”
Well, maybe it’s not Facebook Inc. (NASDAQ:FB) necessarily that wants to “cash in” on friendship – it’s those who are invested in Facebook, or may someday do so. But that is the clash – Facebook wants to build friendships – at least, that was the intent behind Mark Zuckerberg’s invention in his dorm room – but investors want to build equity in their investments. Those aren’t necessarily complementary.
However, while Facebook Inc. (NASDAQ:FB) still seems to have a social awareness about it, at least one business writer sees the potential for business growth as the company builds its friendship reach. He wrote, “The valuation of success should be based on how social media is a cultural shift, from which we cannot go back.”
Thus, maybe the intrinsic value of Facebook (NASDAQ:FB) can’t be entirely found in the market metrics. The cultural impact of Facebook may be above market measures. How much value is that worth to investors?