The same reason that everyone is reporting that Facebook is paying 16 billion dollars for WhatsApp [1] - these stories write themselves so why work hard performing proper analysis?
[1] Facebook would have to provide significantly more shares to sell another $12-15 billlion dollars worth of stock because the increase in supply would drive the current price down. Likewise, WhatsApp couldn't dump that much and maintain current valuation. But placing a reasonable value on the stock requires thinking and thinking makes people's brains hurt...Hell, all financial reporting is that way. The Dow Jones Industrial average keeps going up because the losers are taken off the list and replaced by winners.[2]
[2] Yes the footnote is longer than the post. That's what happens when one is driven to explain. Not that the low standards for journalism require explaining to you.
[1] Facebook would have to provide significantly more shares to sell another $12-15 billlion dollars worth of stock because the increase in supply would drive the current price down. Likewise, WhatsApp couldn't dump that much and maintain current valuation. But placing a reasonable value on the stock requires thinking and thinking makes people's brains hurt...Hell, all financial reporting is that way. The Dow Jones Industrial average keeps going up because the losers are taken off the list and replaced by winners.[2]
[2] Yes the footnote is longer than the post. That's what happens when one is driven to explain. Not that the low standards for journalism require explaining to you.