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Social Networking Series: Facebook.

Of the four major social networking IPOs, Facebook (NASDAQ:FB) is the most talked about. First it had a revenue problem, it seemed that it would not be able to produce revenue from mobile devices. Facebook proved this theory wrong when it produced positive earnings in the second quarter of this year. If you are interested in learning the problems behind Facebook, please read my post on Facebook: Here. (Link: http://s30798690850.whotrades.com/blog/43266027915)

The market is paying a very high price earning multiple, 186 times earnings. This means that the market is very confident that the company can increase revenues significantly. If you want a stock with volatility and risk, FB has a beta of 3.28 making it very risky.