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Paulo Santos
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I am a Portuguese independent trader, analyst and algorithmic trading expert, having worked for both sell side (brokerage) and buy side (fund management) institutions. I've been trading professionally for about 16 years and also launched www.thinkfn.com in 2004. Thinkfn (Think Finance) carries... More
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  • How Wealthy Will Mark Zuckerberg Be? 4 comments
    Feb 2, 2012 1:52 PM | about stocks: GOOG, MSFT, ORCL
    Since Facebook's S-1 is already out, we can do some math and come up with interesting facts.

    For instance, the number of diluted shares will be around 2.395 billion shares. This allows us to calculate the following market capitalizations, given the price where Facebook trades at:

    And the price for a $100 billion market capitalization? $41.75. Which would also be our best guess for the level at which the IPO will price. But obviously it will trade much higher once trading begins.

    Now, we also get to know how many shares Mark Zuckerberg has, including his stock options. The number is 0.5338 billion shares.

    And thus, this is how wealthy Mark Zuckerberg will be and his position on the Forbes list of billionaires:

    Not bad for 6 years' worth of work, I must say! At any rate, Mark Zuckerberg will be wealthier than Google's (GOOG) Larry Page and Sergey Brin, which tie for 24th in Forbe's list. But he won't menace Oracle's (ORCL) Larry Ellison over in 5th, and much less Microsoft's (MSFT) Bill Gates in 2nd. Not, that is, unless Facebook really surprises and goes up more than 67% from a $100 billion initial valuation.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Themes: ipo-analysis Stocks: GOOG, MSFT, ORCL
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  • Paulo, I totally agree.....and I usually do not agree with you...lol
    2 Feb 2012, 01:54 PM Reply Like
  • Author’s reply » Yes, I also think that people might try to calculate Facebook's market cap without taking into account the full 2.395 billion diluted shares ... that would make for an even higher share price, and an even richer Mark.
    2 Feb 2012, 02:07 PM Reply Like
  • The only way Facebook can lose money for speculators when it goes public is if there is a mass defection from users, a growing desire for privacy and a desire not to share private information with advertisers.
    4 Feb 2012, 10:32 AM Reply Like
  • Author’s reply » Nah, over time even the lack of growth could make it be worth less, as it will come in quite overvalued and discounting a lot of future growth.

     

    Btw, I am seeing people calculate the $100 billion market cap while not using all the diluted shares ... that makes for a $53 price instead of $41.75, and could make Facebook even more expensive (in reality, at $53 facebook will already have a market cap north of $125 billion).
    4 Feb 2012, 11:11 AM Reply Like
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