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Fundamentalanalsysis

Facebook (FB): An In-depth Analysis of an Undervalued CompanyIn this post, I’ll be providing an in-depth analysis of Facebook (FB), which was part of FAANG (Facebook, Amazon (AMZN), Apple (AAPL), and Google (GOOGL)), leading the stock market since the financial crash up to 2019, before it was replaced by MAGA (Microsoft (MSFT), Amazon, Google, and Apple). I'll be exploring its business models, financials, weaknesses and threats, the technical analysis of the stock, and my final outlook on the company. Facebook has been under scrutiny for a while, due to issues regarding: fake news scandal regarding the US presidential elections, the violation of data protection laws in Europe, and advertisement boycotts. However, it seems that Facebook is ready for another run as a high-potential growth stock, through its diversification in business models and streams of revenue. Business Models 1. Target Advertisements Based on its tremendous number of users, Facebook has its strength in targeted ads. The ads provided through facebook are optimized through their algorithms, allowing Facebook to receive more money for ads compared to its counterparts. There was a time when Facebook’s ad revenue went up by 50% every year, but growth has slowed down to 10% a year. Nevertheless, based on the recent increase in users, there is huge growth potential as Facebook seeks to advertise in the field of gaming and e-commerce. 2. Increase in users Facebook is another company that benefited from the Corona Virus (COVID-19) pandemic. Its user base increased significantly; FB’s daily active users (DAU) increased by 13%, and monthly active users (MAU) by 12% compared to those of last year. Considering the fact that Facebook’s user growth rate was at a single digit, the increase in number of users demonstrates strong growth potential. With the number of advertisers at 9 million, despite the boycott, Facebook will be able to capitalize on ad demand from mid-small sized companies. 3. Family Applications Facebook owns other family apps such as: Instagram, Facebook Messenger, and Whatsapp. The monthly active people (MAP) for all these applications combined is at 3.14 billion, which makes Facebook the most used social application excluding China. The DAU and MAU for the family applications have also increased by 15.4% and 13.8% each compared to those of last year. 4. E-commerce In August 25, Facebook added a ‘Facebook Shops’ tab on the explore page, allowing users to directly purchase goods. This feature is also available on Instagram as well. This indicates significant growth for Facebook, as it incentivizes users not to open their own shops on Shopify or Amazon, but to open a shop directly on Facebook, which can provide a products page that is optimized for a mobile experience. Considering that the e-commerce landscape is changing to a D2c (directly to customer) format, Facebook and Instagram can easily be the largest market share holder. Also through the use of Facebook messenger, communication between the buyer and the seller is much easy, and live shopping, in the form we have seen in Instagram, is being tested as well. 5. Mobile Payments Whatsapp is launching a service in Brazil, offering payments that could be made to purchase goods, or wire someone money. Consumers can use this service for free, but companies have to pay a 3.99% fee. In the near future, we’ll see people purchase goods directly from Instagram and Facebook, and as such, Facebook has partnered up with e-commerce corporations such as Shopify (SHOP) and Big Commerce (BIGC). 6. Gaming Facbook’s market share in live game streaming has been showing a steady increase, and creating a creator community. They also have strength in the AR/VR gaming industry, as they have acquired the VR headset company oculus in 2014. The growth in revenue of these gaming devices mark a 40% yoy growth. Facebook’s diversification in the gaming industry will also provide them an opportunity for growth. Financials - Facebook generates 98% of its revenue from advertisements - Their ad revenue was less than $20 billion in 2015, but has since grown exponentially to about $70 billion in 2019. - While their gross margin percentage has been declining since 2017 due to traffic acquisition costs, it’s still close to 82%. - Facebook’s cash generation from operations demonstrates phenomenal numbers. - FB is a cash generating machine, and heavily reinvests that capital back into R&D, marketing, and infrastructure. - FB is free cash flow positive, with over $20 billion in 2019. - This means that the company has enough cash on hand to repay creditors and issue dividends to shareholders. - 71.6% comes from Facebook ads, 25.2% comes from Instagram ads - Facebook’s 2020 Q2 ad revenue exceeded expectations. While the cost of advertisement reduced by 21%, with the increase in user traffic, ad revenue increased by 10.2% compared to last year’s quarter, marking $18.32 Billion. - Overall, Facebook demonstrates extremely healthy financials with a mix of steady and exponential growth in their earnings Technical Analysis - To begin with, we can first see that the daily chart is testing the 20 Simple Moving Average (SMA) and the 0.236 Fibonacci retracement resistance - The SMAs are aligned in the order of – 20, 60, and 100 – indicating that the overall trend is an uptrend - Prices have entered, and bounced on the Ichimoku Cloud support - Counting Elliott Waves, we can see that an Impulse Wave Count (12345) has played out since the drop caused by the pandemic, and that we are going through a small phase of correction, potentially counting an Elliott Corrective Wave (ABC). - While a corrective move down to $220 levels around the 0.5 Fibonacci retracement support is possible, it’s not yet probable as significant support levels have not been broken yet. Weakness/Threats - Facebook is exposed to the threat of regulation risks regarding laws of personal information protection. - While Facbook aims to combine all its family apps for synergy, measures will the taken by the government to regulate such efforts, to prevent monopoly. - Apple’s new IOS 14 policy made it difficult for app developers to advertise their product on Facebook, and it’s expected that Facebook’s 2020 Q4 earnings will be affected by it. Final Outlook Overall, Facebook is a big corporation that still has huge growth potential by diversifying its business model. Facebook’s strategy to lock up users within their platform, install shops, and ultimately grow into a payment platform is extremely ambitious yet totally possible. While most people know this company, they are overlooking the growth potential it can achieve, and thus, this stock would be a gem for the long term outlook. If you like this analysis, please make sure to like the post, and follow for more quality content! I would also appreciate it if you could leave a comment below with some original insight.
NASDAQ:METALong
by Michael_Wang_Official
6
Short term Analysis on the USDThe DXY has been on a selling spree of late. Today, Powell said that it will take time to achieve the inflation target and that it will maintain its asset purchase program which stands at US$ 1.4 TRILLION per year. The balance sheet exceeds US$ 7 trillion which has never been witnessed before. When Powell was asked about the FEDs QE, he said that the current policy stance is sufficient and there exists flexibility to act more. This gave the DXY some gains during the day with the overall technical aspect pointing at a deeper upward retracement from all the selling. However, the sellers may not give up without a fight with artificial devaluation of the currency.
ICEUS:DXY
by GrizzlyBearBee
I wouldn't overlook the YEN strengthPrice is currently breaching a trend line connecting two major pivot lows of 2020. If the daily candle closes below the July pivot Low, it could open up the March pivot Low 🎯. It's important to note that the pair is still within a descending flat-bottomed pattern (descending triangle). The JPY is expected to be strong with the candidate best positioned to succeed Shinzo Abe promising to maintain Abe's economic policies. The USD on the other hand is facing pressure from US FED actions to reduce the impact of covid.
Short
by GrizzlyBearBee
EURGBP BUY IDEAAfter piercing through a resistance area last week, it is currently testing this level which is now a support. The level is in confluence with the fibonacci retracement at the 0.382 to 0.5 levels. The pair is expected to complete last week's impulse. A higher target remains in sight in the medium term. The 💶 has faced massive buying of long positions by speculators in the past few months. It's hard to tell whether banks are in profit taking mode before a deeper retracement on the EURUSD or accumulation mode to go after the 1.25 target consensus by analysts for 2020-2021. The GBP is under a lot of pressure with Brexit and the impact covid on the 🇬🇧 economy weighing heavily on the Cable. Looking at the pair from both fundamental and technical perspectives, I will be looking for a buying opportunity.
Long
by GrizzlyBearBee
BTC Weekly Outlook (FA&TA)First of all, please support our work by smashing that like button or following! These really help us to reach more traders like you! Key Fundamentals: 1. Smart money action: The on-chain smart money actions are now stable at a bullish level. This is similar to the on-chain developments before prior bull runs. Institutional investors showed picked up interest in the crypto space as Grayscale raised $900M in Q2 (its ATH quarter since inception). The $900M won’t be available for exiting until at least October 1st this year. And small likelihood that this group will exit at all. (Thanks to NxjaUNHaCucnyxaB’s insightful comment last week.) 2. Miner action: Both hash rate and difficulty have recovered, and miner capitulation has ended. With miner capitulation historically marking market bottoms, this is a bullish long-term sign. 3. Market Sentiment: Overall market sentiment is now neutral to overly bearish. For the seller group sentiment, this group remains in a bull trend, but the current price has already slightly dropped below the actively trading group’s purchase price. This means a decrease in willingness to sell, leading to a decrease in supply, which will ultimately increase price. Assuming bull market, we are in the golden accumulation zone. (Note: The R:R for betting trend changes simply doesn’t appeal to me. Yes, you can bet it every time and never miss a large movement, but you also need to deal with the 30-40% win rate and high operational/execution risks.) 4. Margin & Futures Market Actions: A ridiculous amount of longs were present at the 11.5k level, and a "likely long squeeze alert" appeared before the drop to 10k. Currently, the margin market is overly bearish, but not enough people is on board with the “bearishness” so we do need the open interest to pick up a bit to fuel an ideal short squeeze. As for the CME institutional traders’ positions, last week’s drop doesn’t impact this group turning bullish after 3 months of indecisiveness. The position is for futures, and thus acts as a leading indicator rather than a coincident indicator. Check out the March resemblance. 5. Global Market Impacts: To ease the COVID impacts, the Fed is using all means to boost the economy, which means a continued rise in inflation. This will fundamentally push up the value of gold, bringing up bitcoin along the way as the main value proposition of bitcoin remains store of value rather than remittance. 6. CME Gap 90% of historical BTC CME gaps get filled sooner or later (generally created by weekend BTC movements when the CME’s closed). Yes, we still have a $300 gap open on 7/25 from 9.6k to 9.9k. However, after such a long time, the gap filling (big if here) will be more of a result of general market movements rather than the cause. Key Technicals: 1. Resistance at 11.3k. Support at 9.8-9.9k (If we drop below this level, trend will likely turn bearish). 2. Elliot wave: likely in wave (ii) of III. Wave (ii) currently counted as a zigzag and is potentially finished. 3. RSI neutral to bearish: Failing the RSI MAs and in a bearish trend. However, for the short-term, an upward attempt at the MAs is needed. Meaning I'm leaning bullish for the week ahead. 4. MACD bearish: In bearish trend. No sign of up-cross yet. Do you agree or disagree? All thoughts and critics are welcomed!
COINBASE:BTCUSDLong
by Phi-Deltalytics
79
A clear trend with strong FundamentalsBacked by strong fundamentals, KAVA is one of the most promising coin of the year. With an established uptrend, we recently experienced an over extended increase in the price, resulting in a retrace. We can notice the old resistance trendline (blue) has been turning into a support for the uptrend. The EMA200 is supporting the uptrend as well. Our strategy will be to take some positions on the support trendline and to add more once the local resistance (0.00025089) has been broken.
Long
by NovaBlocks
4
Who drive BTC Price vs. Value? First of all, please support our work by smashing that like button or following! These really help us to reach more traders like you! There are two group of people in the crypto space: long-term investors and short-term speculators. One often overlooked fact is while short-term speculators dominate the actively daily traded BTC, long-term investors actually dominate the entire BTC holding. Understanding how these two groups contribute to BTC value and price separately is crucial in profiting in the long run. “Never invest in a business you cannot understand.” – Warren Buffett Are you a long-term investor or a short-term speculator? Do you agree or disagree? All thoughts and critics are welcomed! =========================================================== 🌐 We believe in the power of blockchain on-chain data analysis! ===========================================================
COINBASE:BTCUSDEducation
by Phi-Deltalytics
25
BTC: FA & TA SetupsFirst of all, please support our work by smashing that like button or following! These really help us to reach more traders like you! Summary: We think BTC will likely fluctuate within the 9k – 10.5k range this coming week. The fundamentals are looking more bullish compared to last week. From the technical analysis perspective, we believe we are at key support, with a 0.4-0.5k bear trap zone beneath. Key Fundamentals: 1. Smart money action: We are now seeing pickups in the on-chain smart money actions. With on-chain vol finding support and stabilizing, we are bullish for the long term. 2. Miner action: Both hash rate and difficulty are recovering, and miner capitulation is ending. With miner capitulation historically marking market bottoms, this is a bullish long-term sign. 3. Overall Market Sentiment: Overall market sentiment is quite rational right now with not much bias. 4. Seller Group Only Market Sentiment: Selling in profit and in bull trend. We picked up alerts of decreasing selling pressure a few days ago, and this is bullish for the short term. 5. Margin Market Actions We have a potential for short squeeze. This is bullish for the short term. 6. SPX impact: See the ideas linked at the bottom. Key Technicals: 1. Strong support at trendline crossover 2. Target: 10.5k for this week 3. Wave developments: We’ll likely keep on developing wave4 this week, fluctuating between 9k – 10.5k. 4. Oscillators at key support What’s your view on the week ahead? Do you agree or disagree? All thoughts and critics are welcomed!
Editors' picks
COINBASE:BTCUSDLong
by Phi-Deltalytics
60
EURNZD WEEKLY ANALYSIS! (SHORT SETUP ON H4 TIMEFRAME)Good day traders, I hope you all have a great weekend ahead and plan your trading strategy week ahead! From weekly perspective, price has retested the key level which is at 1.7641 and ready to go to the downside. In H4 timeframe, price is moving in a down channel. Therefore, in order to find a good short setup, price has to break the minor uptrend as shown in the chart and retest 1.7437 to potentially form a head and shoulder. Entry price: 1.7432 SL: 1.7667 TP: 1.7192 Always go for a clear trading strategy and enter trade with good risk management. It's always you versus yourself instead of you versus the market.
Short
by ChinSengFx
🧱 Fundamental analysis 🧱 Hello, guys.🙌🏻 Today I wanna talk with you about fundamental analysis.💪🏻💪🏻💪🏻 🧐I think, that many of you heard about it, but did you have use it? Write me in the comments✍🏻✍🏻✍🏻 Fundamental Analysis (FA) studies the fundamental foundations of a country's development of political, economic and financial credit policy. In general, fundamental analysis identifies four groups of factors that directly affect the market: 👉🏻economic 👉🏻political 👉🏻rumors and expectations 👉🏻Force Majeure There is an opinion that market movements are determined by fundamental factors, and technical analysis allows you to search for entry points. For a rational distribution of your efforts and the most efficient use of time and opportunities, you need to clearly understand the fundamental analysis mechanism, and also know when and where you can expect the beginning of movement, the time of trading sessions, reduced activity, and even lunch breaks at the world's leading exchanges. You need to pay attention to the time of the release of the main economic indicators of leading countries, such important events as the performances of significant figures of the financial market, such as, for example, the head of the US Federal Reserve, the heads of the Central Bank of leading countries, etc. However, one should not pay excessive attention to this, and think that upon learning any news (unless, of course, this news is of any catastrophic or global nature, such as, for example, the outbreak of war, the terrorist attack of September 11, etc. .), you can get ahead of the market and quickly make the right bets. No matter how sophisticated the software and access to the news feeds you have, it is doubtful that even through the Internet you can have faster and more reliable information than that which the large forex market players possess. And even more so, it is unlikely that you are able to possess insider information. Therefore - ANY NEWS that you have learned through the Internet, Surely the MARKET ALREADY KNOWS. Therefore, your task remains the same: to follow the market, and not try to get ahead of it. Moreover, it very often happens that the market’s assessment of any news is both belated and inadequate, and directly opposite to what one would expect. For successful trading, you must: 💥analyze the reasons for the rise / fall of a financial instrument 💥analyze the depth of these reasons as a factor in influencing the trend of a financial instrument In order not to waste time, analyze only the most important events. I hope my post has become useful to you.😉😉 Stay with me💋💋💋 Your Rocket Bomb🚀💣
BITSTAMP:BTCUSDEducation
by RocketBomb
7
Looking to play another support rejection GBPAUDFundamental case: Overvalued AUD against Australian equities. BJ's lockdown extension caused short term selling and I predict GBP will continue up. Sentiment/PA: Key level for this pair; just as we're seeing on many other pairs, there's an order block (in yellow) controlling the next wave of direction - this level is holding the selling since 1.9500. Still a seller's market and a big challenge for a buy case. Technicals: Market is rejecting 1.9000, with a small double bottom. Market is neutral at best until price is above demand. Entry criteria: A rejection of support. Make sure to follow my ideas. Follow me on twitter @thecolour_red and instagram @madebyforex. - Happy trading.
Long
by madebyforex
1
TESLA INC (TSLA) REVERSAL CLUES TO CONSIDER! hey guys, daily divergence on rsi and immediate, strong bearish reaction from 850 resistance makes me think that something is coming. for now, the main resort for buyers is 685 structure support. during the last month buyers 3 times made the market move from that but each time the movement was relatively weak. if bears will be able to return the prices back again to the abovementioned support, we should look for its bearish breakout. being broken to the downside, buyers will lose their confidence and the price will start falling. don't miss this potential opportunity and set the alert on a key level to be prepared!
NASDAQ:TSLAShort
by VasilyTrader
10
When to Buy Stocks - S&P 500 Dividend Yield CurveBefore start reading on; this chart is inverted. More on that later Interpretation According to Mike Maloney, the S&P 500 dividend yield curve is the second best way to measure a stocks value (after the Shiller S&P500 PE Ratio -made a post on this, go check it out). The ratio indicates how much a company pays out in dividends each year relative to its share price. In other words, it measures how much "bang for your buck" you are getting from dividends. In the absence of any capital gains, the dividend yield is effectively the return on investment for a stock. The lower the dividend yield, the less you get for your investment and hence the more overvalued a stock. The historic S&P 500 Dividend Yields were deducted by Robert Shiller and published in his book Irrational Exuberance. Why is the chart inverted? Two reasons 1. This allows you to see, bubbles are up instead of down, and undervalued is down instead of up 2. The higher the yield the more undervalued the stock is, the lower the yield the more overvalued the stock is Areas of S&P 500 Dividend Yield Curve Stocks are undervalued: 1% - 4% Stocks are undervalued: 4% - 5% Stocks are fair value: 4% - 6% Stocks are undervalued: 6% + Keeping an eye on... The alarming thing when looking at this chart is it has only once ever been this high and that was at the beginning of the millennia and this chart goes all the way back to 1872. As of the time of this writing it is at 1.94. The highest it’s ever been is 1.11. This goes to show the size of the bubble we are currently is. Note: This "indicator" is used to find the best time to purchase stocks, not to pick or find the market top/bottom How to “rebalance the dividend yield curve” Going back to Mike Maloney and his analysis...to bring down this dividend yield he sees two ways the market can seek equilibrium. 1. The market goes sideways for a decade while we have raging inflation that will balance this out and then bring dividend yields and PE’s ratios back into line 2. It crashes, the markets go down The currency supply collapses, therefore this has to be a deflationary collapse, this cant be an inflation in what they call an invisible crash. Note that the source of the material here is from 2011 Source: www.youtube.com (58:22)
MShort
by Muncher
0x - ZRX as bullish as it gets...Dear readers, this is by no means a genious technical analysis in any way - Iam aware of that. So put aside the TA teacher in you and just accept this as a friendly reminder - to not miss the chance on this awesome opportunity. In my opinion 0x is going to explode very soon the same way Chainlink did already! The fundamentals are awesome...: - team - tech - partnerships - exchanges - adoption Everything is on point! Yes - we may fall some Satoshis from here - yes maybe this is not the perfect entry point. But how important are perfect entry points? 1. Almost nobody catches them (even if many out there tell you so). 2. Who cares about the perfect entry, when you booked your 2x or more? This is no short term view - this is a mid term to long term hold to me. The line I painted may be misguiding, do not look at it like this is the way it has to go - its just a rough estimation to paint you a picture for your imagination. Still this is no financial advice - I would never talk somebody into putting his money into this insane high risk, high reward crypto space. As mentioned before - this is just a hint, if you like it - good, if not - fine with me as well. I wish all of you the best of luck - and have a nice day! If possible enjoy it outside and leave tradingview, coinmarketcap and all the exchanges behind at home - at least until the sun goes down ;). Cheers !
Long
by eminenceheld
1