All eyes on Facebook Inc (NASDAQ:FB) as their earnings come out today after the closing bell. In addition to updates on general core advertising trends/performance, investors will listen for discussion on several key areas including: (1) commentary on ad growth rates in 2017; (2) updates on guidance for 2017 opex growth; (3) investments in video content/progress with video monetization; (4) potential contribution from Messenger monetization; and (5) updates on the competitive environment for digital ad dollars.
Ahead of the print, Stifel’s top analyst Scott Devitt reiterates a Buy rating on Facebook shares, with a price target of $165, which represents a potential upside of 9% from where the stock is currently trading.
Devitt noted, “We forecast 1Q total revenue to increase +45% y/y to ~$7.8B (advertising revenue +46% y/y), roughly in line with consensus estimates […] We expect strength in Facebook’s core platform, as well as ramping video / Instagram monetization, to support healthy levels of moderating growth in 1Q and into 2017.”
According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Scott Devitt has a yearly average return of 19.5% and a 73.5% success rate. Devitt has a 29.1% average return when recommending FB, and is ranked #78 out of 4572 analysts.
Out of the 46 analysts polled in the past 12 months, 42 rate Facebook stock a Buy, while 4 rate the stock a Hold. With a return potential of 7%, the stock’s consensus target price stands at $162.66.