Facebook (FB) Under-Promising and Over-Delivering, Brean Capital Says; PT to $111
Brean Capital analyst Sarah Hindlian reiterated a Buy rating and lifted her price target on Facebook (NASDAQ: FB) to $111.00 (from $108.00), saying the company is under-promising and over-delivering.
Hindlian commented, "Facebook reported a solid quarter, well ahead of expectations despite worse headwinds from FX, which negatively impacted reported revenue growth rates by 11%. Importantly, Global ARPU improved 11% sequentially and user metrics were strong. While the company mentioned a slow and steady ramp of Instagram, with no material revenue growth contribution in the near term, this was already reflected in our model for the next several quarters. Qualitative guidance was largely in line with our and cons. expectations, and we note that the company improved its outlook for non-GAAP Operating Expense. We remain convicted in our Buy rating and are raising our TP from $108 to $111. We note strong execution, careful monetization, and a leading long-term position in the digital advertising industry."
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Shares of Facebook closed at $96.99 yesterday.