As the peak of earnings season continues, analysts are out with commentary on earnings announced by big names such as social media giant Facebook Inc (NASDAQ:FB), Chinese e-commerce giant Alibaba Group Holding Ltd (NYSE:BABA), leading chipset maker QUALCOMM, Inc. (NASDAQ:QCOM), and internet retail giant eBay Inc (NASDAQ:EBAY).
In a research report published today, Axiom analyst Victor Anthony reiterated a Buy rating on shares of Facebook, while raising the price target to $145 (from $126), after the company’s fourth-quarter results came in ahead of the analyst estimates across all metrics.
Anthony noted, “Reported revenue of $5.84B (+52% YoY Ex-Fx) was 9% ahead of our estimate and the consensus and accelerated from the 51 % reported in 3Q15. Non-GAAP operating margin of 60% was ahead of our estimate of 54%. Non-GAAP EPS of $0.79 was 13c ahead of our estimate and 11 c ahead of the consensus.”
The analyst concluded, “Buy the stock and hold for the longer term as estimates have yet to reflect contribution from WhatsApp, Messenger, Oculus, the potential for FB to capture a meaningful slice of TV ad budgets through video ads, e-commerce & Search optionality, potential China entry, and the longer-term benefit of expanding Internet usage through Internet.org.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Victor Anthony has a yearly average return of 9.7% and a 52% success rate. Anthony has a 48.4% average return when recommending FB, and is ranked #143 out of 3596 analysts.
Alibaba Group Holding Ltd
Baird analyst Colin Sebastian and team have a note out today reiterating an Outperform rating on shares of Alibaba with a price target of $94, after the company released its fiscal third-quarter results, posting revenue of $5.33 billion with earnings of 99 cents a share, compared to consensus estimates of $5.13 billion with earnings of 89 cents per share.
Sebastian commented, “Alibaba reported FQ3 results mostly above expectations, highlighted by strong revenue growth (+32% Y/Y) and impressive mobile monetization improvement (2.88% vs. 2.55% consensus). While slowing GMV growth is a potential yellow flag, we believe concerns about the effects of China’s macro conditions on Alibaba are largely overblown. Overall, we view these results as largely reinforcing a positive view of Alibaba, even in the face of a transitioning China economy.”
“On the call, management stated that the macro environment is not having a clear impact on the business, and that China’s shift from an investment-driven economy to a consumption-driven economy should ultimately be a tailwind to growth. As such, we expect Alibaba’s share of spend to only increase as consumption increasingly shifts online,” the analyst added.
According to TipRanks.com, analyst Colin Sebastian has a yearly average return of 15.2% and a 62.5% success rate. Sebastian has a -10% average return when recommending BABA, and is ranked #40 out of 3596 analysts.
While Qualcomm shares are down 8% following the release of its fiscal first-quarter earnings, Canaccord analyst Michael Walkley remains positive, reiterating a Buy rating and price target of $65, which represents a potential upside of 46% from where the stock is currently trading.
Walkley wrote, “Qualcomm reported strong Q1/F2016 results with pro forma EPS of $0.97, higher than our above-consensus $0.91 estimate due to stronger QCT shipments and lower operating costs due to faster than anticipated progress on the cost reductions program.”
“However, Q2/F16 guidance was below our expectations due to a challenging macro environment impacting MSM shipments and a new licensing dispute with LG. Qualcomm made great progress the past three months entering licensing agreements with leading Chinese OEMs, and this should help drive improved QTL trends in 2H/F2016,” the analyst added.
Bottom line, “We also believe ramping sales of the Snapdragon 820 combined with ongoing cost reductions should drive stronger 2H/2016 QCT revenue per MSM and margins. Overall, we anticipate gradually recovering QCT trends during F2016 primarily due to improved Android premium tier share with the Snapdragon 820, ongoing progress on the announced $1.4B cost savings program, and stronger MSM volumes following the seasonally weak March quarter.”
According to TipRanks.com, analyst Michael Walkley has a yearly average return of 11.2% and a 54% success rate. Walkley has a 0% average return when recommending QCOM, and is ranked #44 out of 3596 analysts.
Cantor analyst Youssef Squali reiterated a Hold rating on shares of eBay, while reducing the price target to $24 (from $27), after the company reported inline fourth-quarter results, but guided 2016 revenue 4% below the Street expectations. eBay shares reacted to the news, falling nearly 13% on heavy volume, making it among the top losers today.
Squali commented, “4Q results came in line with muted expectations, with slowdown in core Marketplaces offset by an improving StubHub. Overall results show that while management has stabilized the platform and is making progress on key initiatives around structured data, the turnaround remains a work-in-progress, evidenced by sluggish growth in key metrics and core GMV.”
“We remain on the sidelines, awaiting signs of growth re-acceleration from the current low-single-digit level in a market that’s growing in the teens. While strong FCF generation/$1.8B in buyback availability limit the downside risk, we find near-term catalysts lacking and the stock fairly valued,” the analyst concluded.
According to TipRanks.com, analyst Youssef Squali has a yearly average return of 12.7% and a 55% success rate. Squali has a 16.7% average return when recommending eBay, and is ranked #37 out of 3596 analysts.