Facebook is an IPO time bomb waiting to explode. The social network is due to hit its 500 shareholder limit in October. At that point, Facebook is obliged by law to release financial results to the US Securities and Exchange Commission every quarter. By listing before the first filing date in April, Facebook can get a jump on all the public speculation. Will it do so? More than likely.
It's no secret that Facebook is just waiting for the right moment to go public. Sheryl Sandberg, Facebook's COO, spoke at the Reuters Global Technology Summit earlier this year. She described the IPO as "a process that all companies go through. It's an inevitable process for us, the next thing that happens. No one is buying us, we're going public."
Back to the valuation. Hype is definitely building. In February this year, Facebook was valued at around $50bn following a round of investment from Goldman Sachs. But, prior to this deal, a private investor purchased Facebook stock at $55 a share, taking the valuation to a eye-watering $124bn. And so the numbers keep creeping up: Wedbush analyst Lou Kerner has thrown his cap in the ring. His prediction: that Facebook will be worth $200m in 2015.
Let's put this all into perspective: Facebook's estimated revenues hit a very respectable $2bn last year. Respectable, yes. Worthy of a 100x valuation?
Have your say below...