Facebook (FB) IPO Stock Price and Valuation. Oh, and a Few Risks

Facebook filed its Amended S-1 Registration Statement (read it below) with the SEC today, a little more than two weeks before the social media company’s IPO.

The company, whose NASDAQ ticker symbol will be ‘FB’ estimates “the initial public offering price will be between $28.00 and $35.00 per share.” That would put Facebook’s corporate valuation at approximately $100 billion.

Of course, the company didn’t forget to list a few risks.

Some of these risks include:

  • “[A]dverse legal developments relating to advertising, including legislative and regulatory developments and developments in litigation.
  • It’s 901 million monthly active users (MAUs) could decrease;
  • Facebook predicts that its “active user growth rate will decline over time as the size of our active user base increases, and as we achieve higher market penetration rates.
  • “If people do not perceive our products to be useful, reliable, and trustworthy, we may not be able to attract or retain users or otherwise maintain or increase the frequency and duration of their engagement.”
  • Any “decrease in user retention, growth, or engagement could render Facebook less attractive to developers and advertisers, which may have a material and adverse impact” on the company’s revenue and business;
  • Being “the subject of adverse media reports or other negative publicity”;
  • Like Google, Facebook says that it “generate[s] a substantial majority of” the company’s revenue from advertising. “The loss of advertisers, or reduction in spending by advertisers with Facebook, could seriously harm our business.”
  • Competition from a host of other companies.

You can peruse Facebook’s 224-page “Amendment No. 5 to S-1 Registration Statement” here:

Facebook S-1 Registration Statement