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FACEBOOK:FUNDAMENTAL ANALYSIS+PRICE ACTION|NEXT TARGET|LONG🔔🔔Although the Facebook stock is up nearly 33% for the year, some analysts are concerned about the company's prospects. The stock's rise declined after the company released its second-quarter results in late July, as investors were concerned about a slight decline in daily active users in the U.S. and Canada, as well as earnings projections. Nevertheless, the company beat analysts' expectations, reporting year-over-year revenue growth of 56% and earnings per share (EPS) growth of 101%. Both figures exceeded consensus estimates. While there are a few worried analysts, don't count Credit Suisse's Stephen Jue among them. After the quarterly report was released, he raised his target price per Facebook share to $500 from $480 and maintained his outperform rating. This is now the highest price target among Wall Street analysts. While most analysts set price targets for 12 to 18 months, there are several indicators from a valuation perspective that suggest Facebook should be worth $500 a share now. First of all, this is when comparing Facebook to smaller peers such as Twitter and Snap, which trade at projected price-to-earnings (P/E) ratios of 70 times and 270 times, respectively. Facebook's forward P/E ratio is 28.5. Sure, both companies had higher growth rates than Facebook's 56 percent increase in the top line last quarter -- Twitter by 74 percent and Snap by 116 percent -- but it would only take a 40 percent increase in value to become a $500 stock, which is equivalent to 40 times projected earnings for Facebook. Comparisons to the broader market also seem favorable when growth is taken into account. According to Standard & Poor's, Facebook is trading at 27 compared to 31 on the S&P 500, even though the S&P 500 had negative sales growth over the previous year (compared to Facebook's 56% growth previously noted). Finally, Facebook has another way to make it easier to reach the $500 per share price: shares buyback. Reducing the total number of shares increases earnings per share and raises the price per share, all other things being equal. Earlier this year, the company increased its share buyback by adding $25 billion (now 2.5 percent of total shares) to its existing $8 billion authorization. Of course, the Facebook stock carries some risks. It's a rare company that draws bipartisan ire at both the federal and state levels. A recent lawsuit by 48 states as well as the Federal Trade Commission for illegal monopolization was dismissed. State attorneys general have indicated that they will fight the decision. While the rhetoric is heated to the extreme, it is likely that any risk is short-term and has little impact on Facebook's core business. However, Zuckerberg is working on something new, and this could be the biggest opportunity for the company. In his last earnings report, the CEO stated his desire to turn Facebook into a "meta-universe company" within five years. The company has high hopes for an inspired VR experience, which it expects will replace the mobile Internet. Despite Zuckerberg's fervor, investors should view any meta-village-related revenue as the cherry on top of a strong core social media business. It is this optionality that makes the company a sound investment. Facebook's $500 price tag doesn't seem far-fetched, and long-term investors are likely to see the stock exceed that figure - perhaps even sooner than 18 months from now. In addition, the Facebook stock fell yesterday along with the broader market decline on a weak retail sales report. That's probably what caused the social media giant's stock to fall since the performance of its advertising business is closely tied to overall consumer spending. Also, company officials said they would remove Taliban or pro-Taliban content, deeming the group a terrorist organization after its takeover of Afghanistan just the other day. By the end of the day, Facebook shares were down 2.2%, while the S&P 500 was down 0.7% and the Nasdaq lost 0.9%. Total retail sales in July were worse than expected. The Census Bureau reported that total retail sales fell 1.1% from June through July, with auto dealerships, clothing stores, and e-commerce especially weak. The main takeaway from the report seemed to be that the delta variant of COVID-19 was at least a moderate impediment to getting back to work, delaying returns to offices, and possibly discouraging Americans from other activities such as travel. Meanwhile, other sectors that surged at the beginning of the pandemic, such as the auto industry and e-commerce, two key sources of ad revenue for Facebook, now seem to be normalizing as the pandemic-related favorable factors they enjoyed begin to subside. Separately, the company said it is actively removing pro-Taliban content, although the question of what and how to ban it on the platform has been a tricky one in the past. For example, the Washington Post reported that members of the Taliban used WhatsApp to send messages to Afghan citizens, and these incidents could be an eyesore for Facebook if they continue. Yesterday's 2 percent drop in Facebook stock should not change investors' opinions of the company, as such fluctuations are normal, especially given the news about retail sales and the sell-off in the market as a whole. In addition, the company came out with an outstanding earnings report in the second quarter and is likely to perform well in the third quarter since it went through a boycott period last year. This development is a reminder that Facebook faces some political risk, so investors may want to pay attention to how the company is handling the situation in Afghanistan.
NASDAQ:METALong
by FOREXN1
1
FACEBOOK: FUNDAMENTAL ANALYSIS+PRICE ACTION & NEXT TARGET|LONG🔔Facebook beat Wall Street analysts' expectations in its second-quarter earnings report. Revenue rose 56% year-over-year to $29.1 billion, beating analysts' forecasts, and earnings per share doubled from the quarter that suffered a lockdown a year ago to $3.61, beating the consensus forecast of $3.02. Despite that strong performance, Facebook's stock price fell 4 percent as the company's growth lagged behind that of Google's parent company Alphabet, and the company said it expects earnings growth to slow significantly in the second half of the year. But the second-quarter results weren't just indicative of the underlying numbers. Facebook CFO Dave Wehner recently warned investors of an impending slowdown in the company's revenue growth in the second half of 2021. After reporting impressive growth in advertising revenue compared to the second quarter of last year, Wehner reminded investors that April and June of last year were very volatile times for marketers who cut back on advertising spending. As we enter the second half of the year, comparable periods from 2020 will be much more difficult, and revenue growth will slow. That's why investors shouldn't be too concerned about Wehner's comments. Looking back to 2020 and the first half of 2021, investors can get a better idea of where Facebook is headed. In the second quarter of last year, Facebook's ad impressions were up 40%, while average ad prices were down 28%. Naturally, this presents a difficult comparison for ad impressions growth, but it's easy to use the previous year's numbers to compare ad prices. Indeed, Facebook's ad impressions grew only 6% in the second quarter, but ad prices jumped 47%. Facebook | Fundamental Analysis As you can see, ad prices remained relatively low during the second half of the year. While this is still better than the average decline in ad prices in the first and second quarters of 2020, the growth was not what investors are used to. At the same time, growth in ad impressions declined on the back of improved pricing. In his forecast, Wehner virtually eliminated the variable of ad impression growth from the revenue growth equation. He said he believes that the rise in the COVID-19 pandemic, which has been particularly pronounced in the high-margin region of North America, poses a challenge to 2021's attraction growth. In addition, the growing shift from feeds to video products such as Stories, Reels, and Facebook Watch will lead to a decline in impressions. Even if we exclude the growth in ad impressions from revenue growth projections, ad prices should still increase markedly in the second half of the year due to strong demand from marketers. One need only look at the revenue projections of Facebook's competitors to get an idea of demand in the third quarter. According to Twitter, the company expects revenue growth of 30% on average, and Snap, in turn, expects revenue growth of 58-60%. Nevertheless, Facebook should be able to increase the number of ad impressions. First, the company continues to increase the number of daily active users by 7% and 12% on Facebook and the entire family of apps, respectively. Second, the company is increasing ad downloads in its video products, such as Reels, which account for a significant amount of engagement on Instagram. Reels is still in the very early stages of monetization, but it is growing rapidly. This factor, combined with the growth in users, makes modest growth in impressions possible. With continued strong demand for digital advertising and modest growth in the number of impressions, FAANG share ad revenue should continue to grow at a pre-pandemic pace in the upper 20% range. Yes, this is a slowdown from the first half of the year, but it is still very strong growth for a company of this site like Facebook.
Editors' picks
NASDAQ:METALong
by FOREXN1
19
Is that a bullish pennant forming? Facebook appears to be in a consolidation phase. It looks like a bullish pennant is forming and may continue to play out for the next few months. The signals are suggesting that the price is likely to fall somewhat. Lets see if it holds at the support line at around $244. The question is, should one wait before getting into the stock or be of the opinion that an entry point of around $255 - $260 should be an attractive entry point after the bullish pennant has been completed? Fundamentally its a great company and a solid buy and hold. I think it all comes down to the entry point and position size. Please like and follow for daily posts on various asset classes. Please also share your views on the trading ideas and whether or not you find them to be of any value to you as a trader. Please note, this idea is shared for educational and discussion purposes only and should not result in speculative investment decisions in any asset class.
NASDAQ:METALong
by JesseMorgans
Facebook Losing Bull Traction? Channel Spotted..The current upward channel has been good signs for you bullish bag holders as we did break higher overall. We need to keep in mind of were we currently sit on the upward channel though. 3 previous touches on this level of Resistance signaled selloffs to occur. The green horizontal line is previous breakout for a new high, we yet to retest that price. No way that I'm looking to long here too risky, I would like to see a pullback. Best of luck.
NASDAQ:META
by UnknownUnicorn2319099
💰 Will Resistance Hold For Facebook? (FB)💰 LET'S GET INTO SOME FACEBOOK ANALYSIS!💰 1️⃣ First off SMASH that LIKE BUTTON & Give us a FOLLOW for DAILY ANALYSIS! ❤❤❤ (Overall Market Sentiment) 🤷‍♂️ Neutral - 3day Chart - Green Engulfing Candle - 3/3 EMA DOTS Green Facebook is sitting on a key level of Resistance but has not shifted on any indicators yet for the 3 day. Let it play out the rest of the week and see how it closes. Best of luck to you and all of your trades this week! 🤜 Drop your charts and comments down below, share with us what you think is going on in the markets! ❤❤❤ Thanks for checking out our analysis! ✌😁✌ 🥇MLT | MAJOR LEAGUE TRADER
NASDAQ:META
by UnknownUnicorn2319099
Facebook Searching For New Support! (FB)I had a request from a follower earlier today to review facebook stock, let's have a look 😁 We are traveling in a clear controlled parallel channel to the upside from the recovery of the massive selloff. 12hr and up are all firing green and now breaching the past the 232$ old Resistance and trying to turn it into new support. (Horizontal support) We are also turning for a push off the upward channel support. I like that it did push for the highs. All indicators are from the ema dots and the Crossover strategy are shooting green! Your next breakout level will be 237.51, a push up we will travel to the top of the channel. When the candle compresses and fires red with the ema dots indicator that's where we will look for a sell at the top of the channels Resistance or a break out of the parallel upward channel through the bottom of support. For now it looks good to continue to sit on. We will see how strong the old Resistance becomes for a potential new support. If channel were to break and drop below 223.14 we would then look for a short on a distribution play. Best of luck to you, have a blessed day! Want me to review a symbol? Message me directly and don't forget to smash that like button! 💯 🥇MLT | PRO TRADERS
NASDAQ:META
by UnknownUnicorn2319099
16
FACEBOOK, it's increasingHello everybody, What about the Facebook stock price? IT APPEARS WE SHOULD INVEST ON IT MORE . It seems that it’s taking an increasing trend for medium-term times. In fact, the support is pushing it up, even if in the same points time (Circled point), it tries to change its trend but gets increased more. In the future, for medium-term times (A week or 2 weeks for example), we expect that it continues the increasement. He will exceed the level specified by Max point A.
NASDAQ:METALong
by oualidskh