Book Review: The Facebook IPO Primer
http://seekingalpha.com/article/525911-book-review-the-facebook-ipo-primer
If you are interested in the upcoming Facebook (FB) IPO, or Initial Public Offerings in general, look no further than The Facebook IPO Primer. Written by Nancy Miller and produced by eWallstreeter.com, this 42 page e-book is so well done it will make your head spin. When Tim Berners-Lee invented the Web browser and took HTML to another level, he had this type on an interactive product in mind. It's a concise, compact, informative piece of work that knows no bounds.
The document is divided into four sections, each one a learning experience in its own right. Readers can jump to each chapter depending on what it is they are looking for. Even as an experienced investor, I read the book cover to cover, and not only did I learn some things about Facebook, but it also refreshed my memory about past manias.
The third section of The Facebook IPO Primer gets down and dirty with the econometrics of the company from the S-1 statement. Here are some bullet points I found helpful:
- Revenues in 2011 topped $3.7 billion, up 88% from 2010, but not as torrid as the 154% gain posted in 2010.
- Net income in 2011 was a cool $1 billion, up 65% from 2010; net income grew more than twice as fast, by 164%, in 2010.
- Earnings per share rose to 52 cents in 2011, up from 34 cents in 2010 and 12 cents in 2009.
- Facebook is a lean machine: costs and expenses were nearly $1.8 billion, just 47% of revenues.
- The company has an incredible war chest of cash - nearly $4 billion.
This just scratches the surface of some of the data that the author presents. Much more fun than reading an IPO prospectus. Additionally, she breaks down the valuation of the company from five different ..........
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