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And don’t miss Nir Kaissar on Facebook’s predicament: “If Facebook’s historical financials are any guide, a mere 13 percent decline in the number of users — which would leave it with the same number it had at the end of 2016 — would translate into a 23 percent decline in ad revenue per user and a 33 percent decline in revenue. Earnings, in turn, would drop by 43 percent and its P/E ratio would spike to 45. If that were to happen, Facebook’s stock would have to decline by 65 percent to reach that reasonable P/E ratio of 15.5. It would take more than a few defections to bring down Facebook, but investors should bear in mind that the same isn’t necessarily true of its stock.”
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