Buy of Facebook (FB) on Weakness, Needham & Company Says

Needham & Company analyst Laura Martin lowered estimates on Facebook (NASDAQ: FB) following Q3 results and guidance but maintained a Buy rating and $93 price target saying they would be buyers on weakness.

Martin comments, "FB initiated its call with an overview of their 3, 5 and 10 year goals. This long-term focus seems to have given investors the jitters since it implies weak financial results in the 1-2 year time frame. Since investors have liquidity, there is no reason for them to stay in any stock today that will be great 3 or 5 years from now. Finally, FB lowered its 4Q guidance (revenue up 40% to 47%y/y, GAAP expenses up 45% to 50% y/y, and non-GAAP expenses up 30% to 35% y/y), and raised its FY15 expenses guidance, suggesting it will reinvest more of its economics in longer-term opportunities. We would be buyers of FB on weakness."

The firm lowered FY 2014 EPS from $1.70 to $1.61 and FY 2015 EPS from $2.05 to $1.68.

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 $80.77 yesterday.

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