Is Facebook really worth $104B as an enterprise? I don't think so. I have no quarrel with Zuckerberg and the other Facebook founders making bookoo bucks. But the pricing for Facebook is more about the hope and belief that someday all this info they've gathered on people can be turned into earnings and cashflow, something that may or may not materialize. As with all tech IPOs, investors buy on the belief that trees grow to the moon, or that a greater fool lurking somewhere around the corner will buy from them at a higher. Time will tell whether Facebook becomes one of those rare tech companies that actually grows long-term or is a short-term fad. I'm not willing to take that bet at these prices, or even use their product to divulge my private information for their exploitation.
Update 1: My quick back of the envelope calculation would give Facebook a generous $30B valuation, significantly below where it closed on Friday. I doubt it will drop this far anytime soon, but investors should be wary of this stock until it proves it has sustainable, long-term earnings power.
Update 2: Despite shedding almost 7 points in 2 trading days from its IPO, Facebook still looks ridiculously expensive. An overly generous PE of 50 on earnings of $0.31 a share would indicate a fair value of $12.50 a share. A decent entry point for speculators is probably in the single digits.