The rate of gross revenue growth trumps all other variables in
stock performance. Once a company reaches the first inflection
point of the inverted S curve that is so often talked about in garage
to Wall Street tech companies, it is off to the races. Facebook
has now reached about 50% of its ultimate subscriber base. There
is another major growth phase yet to come which will eventually
peak at about 2 billion users worldwide. When that is combined
with amount of advertising dollars that are out there(of which
they have effectively none at present),it is easy to see why early
hype regarding FB could become so inflated. (See Chapter 23 of my
latest book ,"The Millionaire Manual."
Sentiment is a secondary and much more short term force which
can drive prices much lower. Since the negative attitude is now
prevalent the astute investor can now average into FB and
accomplish what everyone says that they want to but very few
ever do. (Buy Low and Sell High).