But investors can lose patience waiting.
On Wednesday, Groupon announced that it had tripled revenue last quarter providing deals on restaurant meals, hotel stays, manicures and the like. No matter. The company also said it hadn't turned a profit — not yet at least. Its stock fell 14 percent.
Facebook is already profitable, but not enough to justify that top-end value of $100 billion. At that lofty height, the company would trade at 145 times what it earned in 2011. The S&P 500 is trading at 15 times last year's profits.
So investors are talking about Facebook's almost $3.7 billion in sales last year, which helps justify the value a bit more, maybe. At $100 billion, Facebook stock would be trading at 27 times sales. LinkedIn is trading at 20 times and Google at five.
We'd all be rich, of course, if picking stocks was just a matter of checking sales multiples or dividend yields or any other simple gauge. Apple doesn't pay a dividend, for instance, but that didn't stop it from rising. Facebook could indeed become the next Apple.
But when it comes to investing, you could do worse than avoiding exciting new businesses in the headlines and putting your money instead into tired old ones you never see articles about, and wouldn't care to read if you did.
Like a company hawking deep fryers.
National Presto Industries makes Big Daddy fryers and other kitchen gadgets as well as what's delicately called "incontinence products," better known as adult diapers. It's run out of a cinderblock converted World War II munitions factory in Eau Claire, Wis., by Maryjo Cohen, a woman so frugal she refused for years to fly anything but coach on business trips, upgrade from Microsoft Office 97 on her computer or replace the Eisenhower-era iron desks at headquarters.
Better to save money for dividends, which the company has been paying for 67 years. That's 40 years before the birth of Mark Zuckerberg, the hoodie-wearing Facebook CEO.
Cohen prefers sensible skirts and blouses but somehow has managed to lift Presto stock up 90 percent above where it was trading at the stock market peak. With dividends, it's returned 157 percent.
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