Why Analysts Are Cautiously Optimistic on Facebook After Earnings
Facebook released its third-quarter 2019 earnings results after markets closed Wednesday, and investors reacted in kind sending shares higher. On the analyst front, most were positive but there were a few that are still not entirely convinced.
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Facebook Inc. (NASDAQ: FB) released its third-quarter 2019 earnings results after markets closed Wednesday. Overall, this was a fairly positive report, with solid top-line and bottom-line beats, and investors reacted in kind, sending shares higher. On the analyst front, most were positive, but there were a few that are still not entirely convinced.
24/7 Wall St. has included some brief highlights from the earnings report, as well as what analysts said after the fact.
For the quarter, the social media company posted diluted earnings per share (EPS) of $2.12 on revenues of $17.65 billion. In the same period a year ago, the company reported EPS of $1.76 on revenues of $13.73 billion. Third-quarter results also compare to consensus estimates for EPS of $1.91 EPS and $17.37 billion in revenues.
The number of daily active users rose 9% year over year to 1.62 billion in September, and the monthly active user total rose 8% to 2.45 billion.
Mobile advertising revenue represented approximately 94% of advertising revenue for the quarter, up from about 92% of advertising revenue in the year-ago third quarter.
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Here’s what analysts had to say:
- Barclays reiterated an Overweight rating and cut its price target to $220 from $240.
- Mizuho reiterated a Buy rating and cut its price target from $247 to $240.
- BMO Capital Markets reiterated it as Market Perform and cut its target to $185 from $197.
- SunTrust Robinson Humphrey reiterated it as Buy and raised its target to $250 from $235.
- Credit Suisse reiterated it as Outperform and raised its price target from $260 to $270.
- Wedbush reiterated an Outperform rating but cut its target price to $250 from $265.
- UBS reiterated a Buy rating and cut its price target from $240 to $235.
- Morgan Stanley reiterated it as Overweight and raised its target to $250 from $235.
- Nomura reiterated a Buy rating and raised its price target to $253 from $235.
- Stifel reiterated a Hold rating and raised its price target to $205 from $180.
Shares of Facebook traded up about 3% on Thursday to $194.00, in a 52-week range of $123.02 to $208.66. The consensus price target is $236.49.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
