Facebook broke the $90/share price yesterday and that makes Facebook (247 billion) more valuable than Walmart (237 billion).
When you take a step back and look at this, doesn’t it seem ludicrous?
Walmart is Walmart… 482.2 billion in net sales (news.walmart.com).
Facebook is everywhere. 1.4 billion active users (newsroom.fb.com). But, they have had difficulty monetizing this market penetration.
I respect Facebook, (I own some FB shares), but to say that the market capitalization of FB is/was greater than WMT is not right. Something is off…
There needs to be a correction, not necessarily in stock prices, but in valuation of companies, especially companies that are tech related and not producing to the levels of their market capitalization.
Arguments could be made for the long term approach. If FB is able to develop a way to monetize their user base, then we can revisit the valuation.
Until then, let’s tread cautiously…
(I am not a certified financial person, these are my opinions, don’t make any rash moves based on this blog entry).