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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (60608)	4/4/2018 7:42:25 PM
From: Graham Osborn	Read Replies (2) of 78748

The hardest nut for me to crack is Facebook's sustainable profit margins, which is key for any annuity-type media play. 40% is crazy high even for digital ads, and I just have a hard time imagining Zuck not continuing to make defensive acquisitions of other social networks and other random toys (so far this policy has worked well in the aggregate). But if you think the profit margins long-term are more like the 20%, you're looking at a different range of value. For me that came out to around $60/ sh, but hey - I'm a pessimist. You would expect that to increase at whatever the growth rate is.

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