Needham & Company Reiterates a 'Buy' on Facebook (FB); Value Is There

June 11, 2012 8:00 AM EDT
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Price: $128.03 -0.24%

Rating Summary:
    48 Buy, 9 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 35 | Down: 31 | New: 9
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Needham & Company reiterates a 'Buy' on Facebook (NASDAQ: FB) price target of $40.00.

Analyst, Laura Martin, said, "The promise of FB (and all social media) is to communicate directly with customers. Participating in the conversation allows brands to have more meaningful relationships with customers. Since we initiated coverage of FB on May 23, several things have occurred that suggest that FB has overcorrected to the downside. FB’s valuation has been under pressure because of skepticism that advertising may not “work” on FB, and that therefore FB’s revenue growth may be disappointing. However, over the past 3 weeks, Oracle (Nasdaq: ORCL) and (Nasdaq: CRM)(BUY) have spent over $1B combined to purchase social marketing companies at higher valuations than FB. These commitments of new money to the social space, of which FB is the anchor tenant, imply that well-regarded public companies are valuing FB more robustly than investors are valuing FB."

For an analyst ratings summary and ratings history on Facebook click here. For more ratings news on Facebook click here.

Shares of Facebook closed at $27.10 yesterday.

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