Dear Disgruntled Facebook Inc (FB) Investors: Get a Clue

Let’s rewind back to May 2012. The excitement was palpable as the world’s largest social connector was going public. There was no way Facebook Inc (NASDAQ:FB) could lose. It had already been around for a number of years and built up a base of registered users close to 1 billion strong. It was like death and taxes: a sure thing.

You know what happened

Fast-forward to today. Facebook Inc (NASDAQ:FB)’s life as a public company has been nothing short of painful to watch. The stock is down 38% from the IPO price and it continues to face questions on how it plans to successfully monetize its mammoth user base. But it’s not like these guys aren’t making any money. In fact, Facebook pulled in about $5.5 billion in revenue over the last 12 months. Though compared to Google Inc (NASDAQ:GOOG)‘s $53.5 billion, that figure seems rather minuscule (keep in mind that Google’s also a far more mature business). Especially when you think that Facebook shares are trading at a whopping 10.5 times sales versus Google at about 5.5 times sales. And Google Inc (NASDAQ:GOOG)’s stock has certainly outperformed Facebook Inc (NASDAQ:FB) since the IPO, as the chart below shows:

FB Total Return Price data by YCharts.

But I digress

What really grinds my gears is when I read articles like the one I read last night by The Wall Street Journal about Facebook Inc (NASDAQ:FB)’s first annual meeting. In short, founder and CEO Mark Zuckerberg had the “pleasure” of taking questions from angry investors about the stock’s performance over the past year. One investor called the stock a “disaster.” Another said he invested “blindly” because he was a “huge fan.” Folks, let me ask you something: If you’re investing in something because you’re a big fan and admit you are investing blindly, why not just plunk down a few bucks at the roulette wheel in Vegas instead? Because that’s basically what you’re doing: You’re gambling.

Now, don’t get me wrong. I’m very much in favor of stock prices going up. And I am also extremely supportive of shareholders’ rights. Maybe people just need a time and a place to vent. But I’m also going to exploit episodes like this and take the opportunity to tell these people to get a clue.