What's the Beef with: Facebook Inc. stock analysis

Facebook Inc (FB)

The social network has come a long way since “the” Facebook days, and in recent years as popularity grew, so did the share price. Amidst controversy about privacy issues, Facebook fighting #FakeNews about Facebook, downtime, and the Crypto hype, Facebook is still pushing boundaries every step of the way.

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Fundamentals & Outlook

The social network has gained more than any other FAANG stock year to date and might be set for another leg higher. The latest announcement that Facebook will introduce its own “cryptocurrency” called Libra has raised the forward outlook on the stock.

Even though Libra is not a cryptocurrency as Libra will be backed by physical assets, it has certainly opened the door for new opportunities for Facebook to generate income and interest. Whether clients will trust Facebook to hold their capital remains to be seen.

The next highly anticipated quarterly earnings release date is set for the 24^th of July 2019 and will be watched closely if regulatory and governmental backlash has filtered through. The Earnings Per Share (EPS) is estimated at $1.85/ share for the quarter, and revenue is expected to come in at $16.5 Billion. 

Chart Life:

Facebook has certainly gained momentum since the major sell-off we saw throughout the second half of 2018. The price action is currently trending upward, and a close above the technical resistance of $202 per share might inspire investors to drive prices back to all-time highs around $217 per share.

By looking at the fundamentals, it is possible to reach highs last seen a year ago, but it might be a bumpy ride back to the top. We might see some downside before we see the $217.50 per share target price in the medium term.

Source - Bloomberg

Portfolio particulars:

• Portfolio Hold (Current)
• Portfolio Buy opportunity: above $202.00 per share 
• WhatsTheBeef Long term Target price: $217.50 

Know your company: Facebook (FB)

• Peter Thiel, co-founder of PayPal, was the first major investor to back Facebook. Thiel, saw the site’s potential and invested $500,000 into the young company in 2004. He later sold his stake in the company for more than $1 billion.
• Sean Parker, co-founder of now-defunct music sharing site Napster, originally acquired the facebook.com domain name for $200,000
• Facebook’s ‘Like’ button used to be the ‘Awesome’ button.
• Facebook’s user base grows by eight people per second, or 7,246 people every 15 minutes.

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 Follow Barry Dumas
@BEEF_FINMARKETS

Barry is a market analyst with GT247.com, with a wealth of experience in the investment markets. Now in his tenth year in the markets, Barry "The Beef" Dumas brings a combination of technical analysis and fundamental insights to the table.