By Bloomberg News

(Bloomberg) -- The $14 billion price tag proposed for TikTok’s US business values it more like a traditional energy or food company than a global social media powerhouse, and may present a bargain for potential buyers including Larry Ellison’s Oracle Corp. and partner Silver Lake Management LLC.

The rough estimate, cited by Vice President JD Vance on Thursday, is well below previous projections that scaled closer to $40 billion. Vance’s comments came as President Donald Trump pushed forward a plan for American investors to buy the US operation from Chinese internet firm ByteDance Ltd.

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Vance conceded that the purchasers will “ultimately” determine the amount paid. While expected buyers would likely welcome a low-ball valuation, ByteDance and its existing investors may find it amusing, if not insulting.

Ashwin Binwani, who is founder of Alpha Binwani Capital and doesn’t hold ByteDance shares, said the proposal “could be the most undervalued tech acquisition of the decade.” He estimated the floated figure reflects a third of TikTok’s true value. “By every major financial metric and peer comparison, this price tag looks dramatically misaligned with reality.”

TikTok’s video-sharing platform ranks among the most popular US social media properties based on average daily app usage. Its influence has also been felt in the proliferation of competing short-video services like Instagram Reels and YouTube Shorts.

WATCH: The $14 billion price tag for TikTok’s US business cited by Vice President JD Vance on Thursday is well below previous projections that scaled closer to $40 billion. Tyler Kendall reports.Source: Bloomberg

Valuing it has always been difficult, particularly given the complexity of the app’s coveted content algorithm. But even by the most conservative estimates, the US operation — the firm’s most lucrative market with 170 million active users — generates revenue north of $10 billion a year.

So at that $14 billion valuation, TikTok US would carry a price-to-sales ratio of roughly 1.4 times, in line with mature, low-growth companies like Exxon Mobil Corp. and General Mills Inc. By way of comparison, Instagram operator Meta Platforms Inc. trades at around 10 times sales while YouTube parent Alphabet Inc. is at 8 times.