Could Facebook Be Worth $175 Billion After It Comes Public?

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Now that Facebook's (NYSE: FB) IPO is officially filed with the SEC, investors are busy crunching the numbers to see if the stock is worth buying even with a suggested market value of $100 billion out of the gate.

First off, growth rates for the social media juggernaut look impressive. Year-over-year revenue growth was 88 percent to $3.711 billion and net income growth was 65 percent to $1 billion. While operating margins dipped from 52 percent in 2010 to 47 percent in 2011, this metric is still very impressive.

But can a $100+ billion valuation be justified?

If the company can maintain 2011 figures, here's what 2012 *could* look like based on certain assumptions:

2012 Projections:

Revenue = ~$7 billion
Income from operations = ~$3.3 billion
Net Income = ~1.9 billion

Here is what 2013 *could* look like:

2013 Projections:

Revenue = ~$13.2 billion
Income from operations = ~$6.2 billion
Net Income = ~$3.5 billion

Essentially, here's a company that could make nearly $2 billion this year and $3.5 billion the following year.

Slapping a 50x multiple on the 2012 number will push the market cap to $100 billion. Looking toward forward estimates and placing a 50x multiple on those would yield a market valuation of about $175 billion.

The key question is if growth can be maintained. Some are already concerned about a deceleration in growth. Specially, fourth quarter 2011 results showed revenue grew just 55 percent from last year and net income for the period only grew 20 percent. That's not the type of growth that will be needed to carry such a lofty premium.

However, assuming Facebook hasn't really even tried to monetize the site, plenty of room is left for Facebook to maintain or even see upside in growth rates. With pressure from Wall Street, Facebook will likely start conforming and finding ways to leverage its 845 million monthly active members to start meeting or exceeding its growth targets.

We will find out in a few months...

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