Skip to main content

Market Overview

Facebook Concerns Are 'Overdone,' KeyBanc Says Ahead Of Q4 Print

Share:
Facebook Concerns Are 'Overdone,' KeyBanc Says Ahead Of Q4 Print

Facebook Inc (NASDAQ: FB)'s decision to change its news feed isn't a cause for concern, according to a KeyBanc Capital Markets analyst.

The Analyst

KeyBanc Capital Markets' Andy Hargreaves maintains an Overweight rating on Facebook's stock with an unchanged $220 price target.

The Thesis

"Legitimate concerns" exist about Facebook's social impact, but any near-term concerns surrounding changes to Facebook's news feed are "overdone," Hargreaves said in a research report. (See the analyst's track record here.)

Facebook's move to prioritize friends, family and local content does not imply a reduction in ad volume, but could sustain consumer usage and grow advertising demand over the longer-term, the analyst said. Even if total ad volume does fall, it could be offset by increased pricing, he said.

Facebook is scheduled to report its fourth-quarter results after Wednesday's market close, and Hargreaves offered the following points of interest investors may want to monitor:

Any update to Facebook's prior 2018 costs and expenses guidance, which were said to be up 45 to 60 percent in 2018.

  • Commentary on Facebook's video platform Watch, which so far offered "limited signs of success to date."
  • Facebook's CPMs have accelerated for three consecutive quarters and should show 35-percent year-over-year over growth in the fourth quarter, which would be in-line with the third quarter's growth rate.
  • Facebook is expected to earn $2.05 per share in the quarter on revenue of $12.61 billion versus the consensus estimate of $1.94 per share on revenue of $12.514 billion.

Price Action

Shares of Facebook were trading lower by around 1 percent early in Tuesday's trading session. 

Related Links:

Report: Instagram Advertising Surges 122%, Amazon Ads Growing 'Very Fast'

Canaccord Genuity's Q4 FANG Earnings Preview

Latest Ratings for FB

DateFirmActionFromTo
Mar 2022Deutsche BankInitiates Coverage OnBuy
Mar 2022Piper SandlerMaintainsNeutral
Mar 2022Morgan StanleyMaintainsOverweight

View More Analyst Ratings for FB

View the Latest Analyst Ratings

 

Related Articles (FB)

View Comments and Join the Discussion!

Posted-In: Andy Hargreaves Facebook News Feed KeyBanc Capital Markets News Feed ChangesAnalyst Color Price Target Reiteration Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
SEDGB of A SecuritiesMaintains411.0
PTLOPiper SandlerMaintains28.0
AOUTLake StreetMaintains26.0
RAPTPiper SandlerMaintains52.0
OCXLake StreetMaintains6.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com