Facebook Is Not Worth $169

Mar. 22, 2018 1:25 PM ETMeta Platforms, Inc. (META)191 Comments
Jae Jun profile picture
Jae Jun


  • News about Cambridge Analytica is non-material to FB as an investment.
  • 2 fundamental indicators showing just how strong FB is.
  • A look at the different valuation methods used to show whether FB is a buy or not.

Yes or no.

Will Facebook (FB) face permanent fundamental damage based on its current Cambridge Analytica news?

My verdict? No.

Like most things, the media is blowing this out of proportion for the sake of clicks and views. The sole purpose of a media outlet is to attract eyeballs, and as they do so often, they jump from one "news" band wagon to another. Facebook just happens to be the punching bag of the day.

Here's a piece from the NYT making it sound like users are leaving Facebook in droves.

Let's assume that 60,000 people deleted their profiles like Cher.

No, wait.

I'll call and raise it to 1,000,000 deleted their account.

Of the 1M users, this obviously includes deactivated accounts and those that were dormant to being with. People with these accounts will be the easiest to delete. If I take a very bad guess and say 20% of these accounts were idle, that means 800,000 active accounts were deleted.

Huge number right?

Here are some facts to put this into perspective thanks to Zephoria and the 10-K.

  • Worldwide, there are over 2.13 billion monthly active Facebook users for Q4 2017 (Facebook MAUs) which is a 14 percent increase year over year.
  • There are 1.15 billion mobile daily active users (Mobile DAU) for December 2016, an increase of 23 percent year-over-year.
  • 1.40 billion people on average log onto Facebook daily and are considered daily active users (Facebook DAU) for December 2017, which represents a 14 percent increase year over year

With 2.13B active Facebook users, 800k deleted accounts equates to 0.04% of total accounts deleted.

Facebook's Moat

Even with the company headlining the news, here's a legitimate reason why people are not leaving Facebook.

Facebook's moat is too strong.

There are other social networks and apps, but people

This article was written by

Jae Jun profile picture
We seek undervalued and under-appreciated stocks to go long before the market catches on. By using our universe of stock ratings and methods to quickly compress our list, we look for the best opportunities to build wealth through the stock market.

Disclosure: I am/we are long FB. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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