Facebook (FB) Downgraded by Zacks Investment Research

Zacks Investment Research cut shares of Facebook (NASDAQ:FB) from a buy rating to a hold rating in a report issued on Thursday morning.

According to Zacks, “Facebook’s top-line benefits from mobile ad growth. The company’s expanding footprint in the developing countries is a positive. Further, the company’s initiatives related to Messenger, WhasApp and Watch are noteworthy. Shares have outperformed the industry in the past year. Nevertheless, aggressive investments on initiatives related to improving ad transparency and security are expected to hurt profitability in the near term. Further, the company is expected to lose some ad impression opportunities due to its focus on growth of Stories on the core Facebook app. This is expected to negatively impact top-line growth. Additionally, regulatory headwinds in countries like Vietnam, Indonesia and Germany is a concern. Meanwhile, estimates have been stable lately ahead of the company’s Q4 earnings release. The company has mixed record of earnings surprises in recent quarters.”

Other research analysts have also recently issued reports about the company. Wells Fargo & Co set a $220.00 price target on Facebook and gave the stock a buy rating in a report on Monday, October 29th. Credit Suisse Group reaffirmed a buy rating and set a $210.00 price objective on shares of Facebook in a report on Wednesday, October 31st. Bank of America decreased their price objective on Facebook from $205.00 to $190.00 and set a buy rating on the stock in a report on Wednesday, October 24th. Nomura decreased their price objective on Facebook from $183.00 to $161.00 and set a neutral rating on the stock in a report on Wednesday, October 31st. Finally, Argus reaffirmed a buy rating on shares of Facebook in a report on Wednesday, January 9th. Four analysts have rated the stock with a sell rating, nine have given a hold rating, thirty-eight have assigned a buy rating and one has given a strong buy rating to the company’s stock. The company has a consensus rating of Buy and a consensus target price of $186.92.

Facebook stock opened at $143.80 on Thursday. The stock has a market cap of $418.99 billion, a price-to-earnings ratio of 23.34, a PEG ratio of 0.92 and a beta of 0.58. Facebook has a 52-week low of $123.02 and a 52-week high of $218.62.

Facebook (NASDAQ:FB) last announced its quarterly earnings data on Tuesday, October 30th. The social networking company reported $1.76 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.46 by $0.30. The company had revenue of $13.73 billion during the quarter, compared to the consensus estimate of $13.82 billion. Facebook had a return on equity of 27.89% and a net margin of 37.57%. The firm’s revenue was up 32.9% on a year-over-year basis. During the same period in the previous year, the company posted $1.59 EPS. On average, equities research analysts anticipate that Facebook will post 7.37 earnings per share for the current year.

In other news, CFO David M. Wehner sold 4,761 shares of the stock in a transaction on Friday, November 16th. The stock was sold at an average price of $141.10, for a total transaction of $671,777.10. Following the transaction, the chief financial officer now owns 76,830 shares of the company’s stock, valued at approximately $10,840,713. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, COO Sheryl Sandberg sold 55,000 shares of the stock in a transaction on Thursday, December 27th. The stock was sold at an average price of $132.11, for a total value of $7,266,050.00. The disclosure for this sale can be found here. Insiders sold a total of 426,550 shares of company stock worth $60,096,109 in the last ninety days. 16.25% of the stock is currently owned by corporate insiders.

Several institutional investors and hedge funds have recently bought and sold shares of the company. Accurate Investment Solutions Inc. raised its stake in Facebook by 35.6% in the fourth quarter. Accurate Investment Solutions Inc. now owns 453 shares of the social networking company’s stock valued at $59,000 after buying an additional 119 shares during the last quarter. Claybrook Capital LLC raised its stake in Facebook by 20.0% in the third quarter. Claybrook Capital LLC now owns 600 shares of the social networking company’s stock valued at $99,000 after buying an additional 100 shares during the last quarter. Cribstone Capital Management LLC raised its stake in Facebook by 186.2% in the second quarter. Cribstone Capital Management LLC now owns 624 shares of the social networking company’s stock valued at $121,000 after buying an additional 406 shares during the last quarter. IMA Wealth Inc. purchased a new stake in Facebook in the second quarter valued at about $122,000. Finally, Trust Department MB Financial Bank N A purchased a new stake in Facebook in the second quarter valued at about $134,000. 58.14% of the stock is currently owned by institutional investors and hedge funds.

About Facebook

Facebook, Inc provides various products to connect and share through mobile devices, personal computers, and other surfaces worldwide. Its products include Facebook Website and mobile application that enables people to connect, share, discover, and communicate with each other on mobile devices and personal computers; Instagram, a community for sharing visual stories through photos, videos, and direct messages; Messenger, a messaging application to communicate with other people, groups, and businesses across various platforms and devices; and WhatsApp, a mobile messaging application.

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