The stock market is taking it on the chin today after multiple earnings disappointed investors. DuPont saw one of the biggest drop today after reporting their earnings. DuPont saw its profit fall short of estimates and announced they will be cutting 1,500 jobs as part of a cost cutting move. DuPont shares have been down as much as 9% today. 3M reported earnings that met expectations, but revenue was a bit lighter than expected sending shares down more than 3%. [Read more...]
The most anticipated stock market debut of 2012 is expected to value Facebook at as much as $100 billion, which would top just about any of Silicon Valley’s most celebrated coming-out parties, from Netscape to Google Inc.
Market watchers say Facebook seems destined to set a new benchmark in a region famous for minting fortunes, with even the rank-and-file employees reaping millions of dollars.
Facebook employees past and present are already thinking about how to spend their anticipated new wealth, even as securities regulations typically prevent employee stock options from being cashed in until after a six-month lock-up period.
“There’s been discussions of sort of bucket list ideas that people are putting together of things they always wanted to do and now we’ll be able to do it,” said one former employee who had joined Facebook in 2005, shortly after it was founded.
Facebook was founded in a Harvard dorm room in 2004 by Mark Zuckerberg and his friends. Facebook has grown into the world’s biggest social network with over 800 million members and revenue of $1.6 billion in the first half of 2011.
Facebook’s earliest employees, who were given ownership stakes, and early venture capital investors, such as Accel Partners, Greylock Partners and Paypal co-founder Peter Thiel, will see the biggest paydays. Zuckerberg, 27, is estimated to own a little over a fifth of the company, according to “The Facebook Effect” author David Kirkpatrick.
The wealth will trickle down to engineers, salespeople and other staffers who later joined the company, since most employees receive salary plus some kind of equity-based compensation, such as restricted stock units or stock options.
There are reports today of Facebook being in internal discussions over the exact timing of its filings with the SEC for its IPO, and may file before the end of the year. Reports indicate that Mark Zuckerberg, CEO of Facebook, hasn’t made any final decisions yet. Facebook is also looking into raising $10 billion in an IPO that would value the company at $100 billion if not more.
If you’re looking to compare this to other online juggernauts IPO’s, look at Google, Inc. (NASDAQ:GOOG). In 2004, when they made their stock debut, the company was worth $27 billion. Google’s market cap today sits around $185 billion.
At a $100 billion valuation, Facebook would be worth more than a lot of big name companies including Hewlett-Packard (NYSE:HPQ) and Cisco Systems (NASDAQ:CSCO).
If they file for an IPO it would be the latest of a series of companies going public in Silicon Valley. Zynga, creator of Farmville, has already filed for an IPO up to $1 billion. In November, the much hyped Groupon (NASDAQ:GRPN) IPO was launched, but has since dropped below its IPO price. Other stocks that jumped initially but fell include LinkedIn (NYSE:LNKD) and Pandora (NYSE:P).
While Facebook does not disclose financial results, sources close to the company told Reuters earlier this year the company’s revenue in the first 6 months of 2011 doubled from the previous year to $1.6 billion.
Founded in February 2004, Facebook is a social utility that helps people communicate more efficiently with their friends, family and coworkers. The company develops technologies that facilitate the sharing of information through the social graph, the digital mapping of people’s real-world social connections. Anyone can sign up for Facebook and interact with the people they know in a trusted environment.