Facebook Surges Past $100 Billion Value With 1.9% Price Increase

on August 26 2013 8:03 PM
Facebook Sandberg  2012
Facebook COO Sheryl Sandberg. Reuters

Facebook (NASDAQ:FB) saw its market value top $100 billion Monday as its stock rose 1.9 percent to $41.34 by the end of the day. The landmark is further confirmation that investors are betting on Facebook’s ability to earn more advertising revenue in the future.

According to Bloomberg, Facebook shares have increased 55 percent this year after slumping in late 2012. Though Facebook launched with a $16 billion IPO, its stock price soon plummeted, reaching lows of $17.73 at one point in September. Now, Facebook’s shares are trading at roughly 180 times its earnings, showing that investors are banking on Facebook’s ability to increase revenue soon.

“The market is gaining confidence that Facebook is going to be a viable profit-generating machine in the future,” Laurence Balter, an analyst at Oracle Investment Research, told Bloomberg. “People are checking their Facebook page more and more all the time.”

The jump in price is a significant boost from last week, when Facebook shares were trading for under $39. As MarketWatch reports, Facebook COO Sheryl Sandberg sold 176,452 shares of the social media company on Thursday at a price of $38.52 each, totaling $6.8 million altogether. At Monday’s value, the trade would have been worth approximately $7.3 million, not an insignificant difference.

Valued at $100.7 billion, Facebook is one of only a handful of tech companies to reach the $100 billion mark. Others include Amazon (AMZN), Apple (AAPL), and Google (GOOG).

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