UPDATE: Facebook's (FB) IDFA Woes are a Bump in the Road to Metaverse, PT Raised to $400 at BofA Securities

October 26, 2021 5:46 AM EDT
Get Alerts FB Hot Sheet
Price: $291.75 -6.07%

Rating Summary:
    51 Buy, 12 Hold, 2 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 7 | Down: 8 | New: 70
Trade Now! 
Join SI Premium – FREE

News and research before you hear about it on CNBC and others. Claim your 1-week free trial to StreetInsider Premium here.
(Updated - October 26, 2021 6:29 AM EDT)

BofA Securities analyst Justin Post raised the price target on Facebook (NASDAQ: FB) to $400.00 (from $385.00) while maintaining a Buy rating after the company reported revenue of $29.0bn, (+35% y/y) below the Street at $29.6bn. Ad revenue growth at 32% y/y ex-FX, decelerated 19pt q/q on an 11pt tougher comp. GAAP op. income was $10.42bn vs $10.98bn due to lower revenue flow through, but EPS was ahead on lower taxes. Most importantly, monthly active users (MAUs) of 2.910bn (+6%) was slightly below Street at 2.927bn, reflecting some international market saturation.

The analyst sees this as a one off quarter, stating "Key positives for quarter are IDFA headwinds may have peaked in 3Q, FB is guiding to better-than-feared 4Q q/q growth, and, despite big investments, core business EPS may be higher-than-expected in 2022 backing out FRL investments. We updated our SOTP valuation method to account for FRL disclosure, and raise our PO to $400 based on a new 16x P/E multiple on updated core business EPS, plus cash. At the $335 AH price, we estimate that core FB is valued at 12x ‘22 core FB P/E adjusting for messaging value, cash and FRL -- a value multiple for a double-digit growth company."

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In

Related Categories

Analyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change, Hot Comments