Facebook Inc. (FB) operates a social networking website worldwide. The Company's products for users are free of charge and available on the Web, mobile Web, and mobile platforms, such as Android and iOS. Its website enables users to connect, share, discover, and communicate with each other. The Facebook Platform is a set of tools and application programming interfaces that developers can use to build social apps on Facebook or to integrate their Websites with Facebook. It offers products that enable advertisers and marketers to engage with its users. Facebook Inc. is headquartered in Menlo Park, California.
Unlike the latest from Twitter we discussed yesterday, Facebook reported a far brighter earnings and growth picture with its earnings for Q2. Facebook exceeded Wall St. expectations AND maintained good user-base growth. For the quarter, revenue rose 39% to $4.04 billion--up from $2.91 billion a year ago. Net income was $719 million, or $0.25/share, compared to $0.30/share a year ago. The company reported a profit of $0.50/share, which beat analyst estimates of $0.47/share.
The company's "monthly active users" (MAU) in this quarter totaled 1.49 billion, and increase of 13% year-over-year. Increases in users were within that range in all categories. Those are the sort of numbers advertisers like to see, and the company's advertising revenues increased accordingly--43% year-over-year.
Analysts note that the company growth and associated revenues have scaled up nicely, and its rate of growth is similar to Google's when it was at its height. Mobile growth has been very strong, and the stock price has responded in kind. Facebook's performance stands in stark contrast to Twitter and other sites along the same "flight path"--such as Yelp.
Despite this growth, our forecasts remain a bit flat long term. This may change as price movements are digested and analysts increase their earnings estimates moving forward. Facebook is expected to begin to monetize Instagram, the popular photo sharing site, and if it can duplicate its success there, then revenues could dramatically increase as well.
For now, ValuEngine continues its HOLD recommendation on FACEBOOK INC-A for 2015-07-29. Based on the information we have gathered and our resulting research, we feel that FACEBOOK INC-A has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Price Sales Ratio.
Below is today's more extensive data on FB:
|
ValuEngine Forecast |
||
|
Target |
Expected |
|
|---|---|---|
|
1-Month |
96.79 |
-0.20% |
|
3-Month |
96.44 |
-0.57% |
|
6-Month |
97.30 |
0.32% |
|
1-Year |
94.64 |
-2.43% |
|
2-Year |
113.46 |
16.99% |
|
3-Year |
77.68 |
-19.91% |
|
Valuation & Rankings |
|||
|
Valuation |
17.47% overvalued |
Valuation Rank(?) |
 23 |
|
1-M Forecast Return |
-0.20% |
1-M Forecast Return Rank |
35 |
|
12-M Return |
31.58% |
Momentum Rank(?) |
88 |
|
Sharpe Ratio |
0.75 |
Sharpe Ratio Rank(?) |
85 |
|
5-Y Avg Annual Return |
34.50% |
5-Y Avg Annual Rtn Rank |
96 |
|
Volatility |
45.70% |
Volatility Rank(?) |
37 |
|
Expected EPS Growth |
35.59% |
EPS Growth Rank(?) |
70 |
|
Market Cap (billions) |
271.28 |
Size Rank |
100 |
|
Trailing P/E Ratio |
82.19 |
Trailing P/E Rank(?) |
31 |
|
Forward P/E Ratio |
60.62 |
Forward P/E Ratio Rank |
6 |
|
PEG Ratio |
2.31 |
PEG Ratio Rank |
19 |
|
Price/Sales |
20.08 |
Price/Sales Rank(?) |
6 |
|
Market/Book |
17.25 |
Market/Book Rank(?) |
7 |
|
Beta |
0.48 |
Beta Rank |
74 |
|
Alpha |
0.22 |
Alpha Rank |
87 |
VALUATION WATCH: Overvalued stocks now make up 51.86% of our stocks assigned a valuation and 19.67% of those equities are calculated to be overvalued by 20% or more. Nine sectors are calculated to be overvalued--with three at or near double digits.
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