With Facebook, It’s Always Too Much or Too Little

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facebook-logo-2The last thing anyone expects to hear about Facebook (NASDAQ:FB) is that it’s valued at just the right price, not too much, not too little. The stock’s infamous post-IPO plummet fueled a frenzy of “no way this company is worth this much” trading behavior that took shares as low as $17.55. But over the past few months, sentiment has rounded the corner and the stock has been on a tear, climbing 61.8 percent since the middle of November to close Monday at $32.47.

This rally has been fueled by Facebook’s ruthless drive to engage users and monetize advertising services. Products like Custom Audiences, Facebook Exchange, Gifts, and Sponsored Stories will be the driving force behind its fourth-quarter revenue, which is projected to come in anywhere between $1.5 and $1.6 billion. The conservative end of this spectrum represents a 36.3 percent year-over-year increase.

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Of course, the elephant in the room is mobile. Monetizing its 600 million mobile monthly active users — 60 percent of total users in the third quarter, and up 61 percent year over year — is Facebook’s holy grail. Mobile users are 30 percent more active than desktop users, but as of the third quarter, mobile accounted for just 14 percent of ad revenue. This puts Facebook in the same conundrum as ad-revenue competitors like Google (NASDAQ:GOOG), which has yet to grow mobile advertising…

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