Goldman Sachs Comments on Facebook's (FB) Oculus VR Deal
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Rating Summary:
46 Buy, 17 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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On Tuesday, investors learned that Facebook (NASDAQ: FB) reached a definitive agreement to acquire Oculus VR, Inc., a developer of virtual reality technology, for a total of approximately $2 billion.
Commenting on developments, analyst Heather Bellini of Goldman Sachs said, "Oculus develops a virtual reality headset for gaming, the Oculus Rift. The company also sells development kits, at ~$300, and has received more than 75,000 orders. While Oculus currently focuses on video games, Facebook management described the gaming use case as largely a strategy to gain user adoption with the long-term intention to use the virtual technology as a next-gen communication platform. Potential use cases outside of gaming include watching a sports game virtually courtside, consulting with a doctor face-to-face, and studying in a classroom with students from around the world."
"We view the Oculus acquisition as being in line with Facebook's focus to enable fast communication and what we see as an emerging strategy to develop applications that can appeal to users outside of the main Facebook app. That said, the long-term vision of Oculus is still unproven (unlike the use cases of the Instagram and WhatsApp deals), though we see Oculus’ technology and Facebook's mass appeal as key drivers in developing the virtual communication market," added the analyst.
Goldman Sachs has a Buy rating on Facebook with a price target of $78.00
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 $64.89 yesterday.
Commenting on developments, analyst Heather Bellini of Goldman Sachs said, "Oculus develops a virtual reality headset for gaming, the Oculus Rift. The company also sells development kits, at ~$300, and has received more than 75,000 orders. While Oculus currently focuses on video games, Facebook management described the gaming use case as largely a strategy to gain user adoption with the long-term intention to use the virtual technology as a next-gen communication platform. Potential use cases outside of gaming include watching a sports game virtually courtside, consulting with a doctor face-to-face, and studying in a classroom with students from around the world."
"We view the Oculus acquisition as being in line with Facebook's focus to enable fast communication and what we see as an emerging strategy to develop applications that can appeal to users outside of the main Facebook app. That said, the long-term vision of Oculus is still unproven (unlike the use cases of the Instagram and WhatsApp deals), though we see Oculus’ technology and Facebook's mass appeal as key drivers in developing the virtual communication market," added the analyst.
Goldman Sachs has a Buy rating on Facebook with a price target of $78.00
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 $64.89 yesterday.
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