Monness analyst Brian White is out with a research note on shares of Facebook (NASDAQ:FB), following a report that multiple U.S. federal agencies are investigating the social giant’s improper sharing of user data with now-defunct political consulting firm Cambridge Analytica.
Facebook confirmed that it has been contacted by the U.S. agencies and said it is cooperating with the investigations. “We’ve provided public testimony, answered questions, and pledged to continue our assistance as their work continues,” a Facebook spokesman said in a statement.
White commented, “Given the high profile nature of the Cambridge Analytica fiasco, the size of the Facebook platform and the implied political machinations around the breach, we are not surprised by the interest of the SEC, FBI and FTC joining the Department of Justice in this investigation […] We have warned that aftershocks related to the Cambridge Analytica fiasco were likely throughout 2018 and Facebook’s stock fell by over 2% on Tuesday. However, we believe the shock value of this scandal is already reflected in the stock that trades at just 20x our CY19 EPS projection (ex-cash) for a company that we are projecting 40% revenue growth in 2018 with 43% EPS growth.”
As such, White reiterates a Buy rating on FB with a price target of $225, which implies an upside of 14% from current levels. People often ask, is it worth listening to this analyst? In this case, the answer is clearly yes.
According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian White has a yearly average return of 16% and a 67% success rate. White has a 12.6% average return when recommending FB, and is ranked #111 out of 4826 analysts.
Wall Street’s confidence backing Facebook is strong, with TipRanks analytics showcasing FB as a Strong Buy. Based on 30 analysts polled in the last 3 months, 28 rate a Buy on Facebook stock, while only 1 issues a Hold and 1 recommends a Sell. The 12-month average price target stands at $224.46, marking a nearly 14% upside from where the stock is currently trading.