FACEBOOK'S looming initial public stock offering has investors buzzing, but they shouldn't get too caught up in the excitement.

Barron's writer Andrew Bary makes that argument in the Feb. 6 edition of the investing-focused publication.

"The best businesses can be poor investments, if you pay the wrong price," Bary cautions prospective Facebook buyers.

The IPO is valuing Facebook, which was formed less than a decade ago, at $100 billion. That will instantly make CEO Mark Zuckerberg one of the wealthiest people on the planet.

There is no doubt that Facebook is a great business. Nearly 500 million people visit the site every day, often for long periods of time, and the number is growing. That allows Facebook to sell lots of ads. In a sense it has become a second World Wide Web, with companies using their Facebook pages more than their own websites.

But Facebook is going to come public at almost 100 times earnings, Bary points out. That compares with trailing price-earnings ratios of 16 at Apple and Google, which are both awash with tens of billions in cash and also have great and growing business franchises.

Facebook would need to double earnings for three straight years to be valued on par with Apple and Google. It also faces the problem of people using their smartphones to access Facebook's mobile site, where ads typically don't show up.

Many people will likely throw this kind of caution to the wind and jump on the Facebook train, and it may end up proving a wise course of action.

But investors typically don't fare well with stocks priced for perfection, as Facebook seems to be.

Lessons from delivering papers, cutting lawns

A Richmond-area man named Rich Babbitt who works with SunTrust Bank in the Fredericksburg area recently sent me his new book called "From Paperboy to Boomer."

It's a quick read that shares the lessons learned delivering newspapers and mowing lawns as a boy--including perseverance, hard work, customer service, salesmanship, multitasking, budgeting and leadership. Babbitt also describes how to evaluate current and prospective business hires on the extent to which they have those skills.

For more information go to BoomersBook.Biz.

Staff reporter Bill Freehling writes this biweekly column on business, personal finance and investing. He can be reached at 540/374-5405 or
Email: bfreehling@freelancestar.com.