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FAANG stock Facebook (FB) still on a high track

Written by Customer Service on . Posted in Public Companies.

FB stock originally went higher than buy point last April 29, reaching a new record high after they released their Q1 earnings report which exceeded estimates.

Now that the ongoing concern about growth stocks, as well as concern over Apple’s new privacy measure pulled FB stocks down to buy range, the question of whether this stock is a good buy or not rises.
Looking back into the data, Facebook released their Q1 earnings per share of $3.30 which is 93% higher versus last year’s and is $0.93 above expectations. Revenue topped by 48% which was driven by the 30% increase in ad prices and now recorded $28.1 billion. Though the number of ad impressions only grew 12% versus 25% growth in 2020 Q4 records, it is not being bogged down by it.

Facebook itself has previously warned that the spike in usage of social media apps is one of the results of the pandemic, and is expected to normalize as recovery goes by. What we need to focus on is that the advertisers using Facebook are now utilizing the social media app to connect with prospects like never before. The number has grown to 10 million business for the group of advertisers.

The stock further rallied last March 19 when CEO Mark Zuckerberg announced their big e-commerce push. Shops was developed to bring e-commerce purchases within the app, to increase utilization and to lower down off-site purchases. Businesses can now set up a single show for Facebook and Instagram users.

The CEO also suggested that the Apple’s IOS ad-tracking update might as well be a blessing for them as long as the changes encourage commerce on a single platform since the internal data shall be singular for advertising purposes. It will remove the need for tracking off-platform lowering the risks.

The stock jumped after the Shops talk, and further drove higher after earnings reports were released. Now a slight pullback happened after investors digest ad-tracking opt-out data. Now that Facebook is just slightly lower, traders opt to call this buy range as they expect Facebook to bounce back after it settles down.

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