Facebook: Future Remains Bright, Says Wedbush; Maintains Outperform
Wedbush analyst Shyam Patil maintained an Outperform rating on Facebook Inc. (NASDAQ:FB) with a price target of $90, following the company’s earnings results for the third-quarter.
Patil wrote, “While 3Q was strong across the board and better than expected, we are lowering our 2015 EBITDA estimate (though modestly raising revenue), as 2015 appears to be an investment year. Management did not provide many specifics, but plans to invest in people (hiring), products (such as its Ad Tech stack, Oculus, WhatsApp), and infrastructure. While the stock is likely to be under pressure, we believe the long-term story remains bright and would view any pullback as a buying opportunity. We continue to believe there are several near-, intermediate- and longer-term catalysts to drive shares higher over time. In the near-term, we believe the core mobile newsfeed ads along with the improved right rail desktop ads are key drivers, while in the intermediate-term, video ads and offnetwork ads (via Atlas, FAN, and LiveRail) could be meaningful contributors. Longer-term, we believe Instagram monetization and WhatsApp represent large opportunities.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Shyam Patil has a total average return of 6.8% and a 60.0% success rate. Patil has a 10.6% average return when recommending FB, and is ranked #1252 out of 3354 analysts.