Facebook shares top $200bn as it becomes 22nd biggest firm in the world

Facebook’s value has soared above US$200 billion for the first time, making it the 22nd biggest company in the world. The milestone was reached in trading on Monday with the social network’s market capitalisation—the total value of its shares—reaching US$202.5 billion when the Nasdaq closed for business. Each share was worth US$77.89—more than double the amount demanded per share when Facebook made its troubled stock market debut in May 2012. Analysts were quick to point out that the valuation was achieved at a faster pace than rival Google, which is now worth double Facebook’s value at just over US$4 billion at current prices.

This latest rally stems from their last earnings announcement, when they reported higher demand and sales numbers for their mobile ads. If they can continue to grow their mobile ads, they will have a sustainable demand for their stock.

Jeffrey Sica, president of Sica Wealth Management

Google took more than three years to reach the milestone after its flotation in 2004, though its growth was later hindered by the effects of the financial crisis in 2008. Both companies have since been battling for greater revenue from online advertising—with Facebook benefiting particularly from the rise in mobile devices. Its stock rose 0.8 per cent on Monday after an internal report highlighted progress in its video business—another advertising growth stream. Revenue per user for the 3 months to June 30 was US$2.21 compared to Twitter’s US$1.15 for the same period.