Are “Like” buttons worth more than “everyday low prices”? Wall Street thinks so. Facebook shares are up 3,6% in afternoon trading, and touched a new high of $87.91, after the company introduced several new ad formats it plans to use on mobile phones. The news contributed to an $8.4 billion rise in Facebook’s market value.
That means the social network company’s worth nearly $240 billion — passing Wal-Mart at $234 billion. It pushed Wal-Mart off the list of the 10 most valuable companies, the first time that has happened since 1997. Looked at another way, Facebook is worth 24% more than Disney, and nearly 56% more than Comcast.
The values tell you a lot about where the smart money believes the world is heading. By almost any other measure, Wal-Mart crushes Facebook. The retailer has more than 11,000 stores in 28 countries, and generated more revenue than any other company in the world last year. Its sales of $485.7 billion compare to $12.5 billion for Facebook.
But the market values growth opportunities, and that’s where Facebook shines. Shares in the Internet company that Mark Zuckerberg created in 2004 are up 12% this year, Execs reassured investors that Facebook will continue to enlist new users — including teens — and sell more expensive ads. The company reported 1.4 billion active users worldwide in Q1.
By contrast, Wal-Mart shares are down 15.6% so far in 2015. It has struggled to keep up with competitors including Costco, and it has yet to see a big pay off from its efforts to boost online sales. Meanwhile, the strong dollar has depressed the value of its overseas earnings.
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