Facebook Remains A Top Pick For Us, Says Cantor’s Youssef Squali

In a research report published this morning, Cantor analyst Youssef Squali maintained a Buy rating on Facebook Inc. (NASDAQ:FB) and raised the price target to $90 (from $80), as the company reported its fourth-quarter results, posting revenue of $3,851M and NEPS of $0.54, both exceeding consensus at $3,780M and $0.48, respectively.

Squali observed, “We maintain a BUY rating on FB with a new PT on the back of solid 4Q:14 results, with both revenue and NEPS exceeding StreetAccount consensus estimates. FB remains a top pick for us, given 1) its growing position as the largest/most-engaged Internet platform, offering personalized marketing at scale, 2) the ongoing shift of ad dollars to mobile/social, and 3) untapped monetization potential for Instagram, Messenger and WhatsApp (at 300M, 500M and 700M MAUs, respectively and growing), all at a compelling valuation.”

The analyst added, “FB is trading at 11.2x EV/revenue and 17.0x EV/EBITDA on our adjusted FY:1 5 estimates, a valuation we find compelling given the sheer amount of time Facebook users spend on the site, successful mobile ad formats, growth potential from increased advertising CPMs, and additional monetization opportunities over time.”

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