The Facebook stock continues to sell off' Shares debuted at $38 a share on May 18. They hit a high of $45 that day (the smart money was selling on the way up), then retrenched to $38.23 at close. It was a disappointing opening for one of the most anticipated initial public offerings (IPOs) in history.

Facebook went public with a valuation of more than $100 billion. Compared that to Amazon ($95 bil) , McD ($92 bil) & Visa ($80 bil)

Looking at the table above & basing on 2011 earnings of $1 bil and rev of $3.7 bil, FB’s PE is 100 times. It means if the earning per share dont change over time, you need to wait 100 years before you get your investment back. How many of us live past 100 years ?

Industry analyst said that FB may trade back to historical PE of SP500 US companies around 13-15 times multiple and if that’s the case, there is still a low way down for FB. Look at the chart below.

Today, shares of Facebook hit a new low of $28.25. The current market cap is $63 billion. The company is still overvalued ' at 63 times 2011 earnings ' and we expect it will go lower.

I was talking to a technology person who has been working in this industry over 25 years and he tell me if he like FB because of the targeted revenue stream from online marketing advertisement it can generate over traditional business such as newsprint and Google Advertisement. However at $28-29 per share, it is way pricey.

Mark Hulbert, a contributor to Dow Jones MarketWatch, believes the stock will plummet from here' He titled his recent article “Facebook’s stock should trade for $13.80.”