Facebook, Inc (NASDAQ: FB)
On Tuesday after the market closed Facebook, the undisputed king of social media, reported fourth quarter earnings that crushed all expectations at a time when a fatigued market was prepared for, and perhaps anticipating disappointment. Traders responded accordingly after-hours, bidding the stock up 13.6% on heavy volume to a high of $107.25.
Facebook reported fourth quarter revenue of $5.84 billion, far exceeding consensus estimates of $5.37 billion and 52% higher than Q4, 2014 revenue of $3.85 billion. Earnings for the quarter were 79 cents per share, a 49% year over year increase and easy beat of analyst’s consensus estimate of 68 cents per share. Facebook’s revenue growth rate was the best in five quarters and the earnings growth rate was the best in four quarters. For the full fiscal year 2015 revenue was up 44% from the prior year to $17.93 billion. Fiscal 2015 earnings came in at $2.28 per share, a 29% increase over 2014 earnings. At a time when the social media stocks are sluggish and bearish dialogue is the norm, Facebook’s financial and growth metrics tell a compelling story.
Facebook CEO Comments
Facebook founder and CEO Mark Zuckerberg said in a statement:
“2015 was a great year for Facebook. Our community continued to grow and our business is thriving. We continue to invest in better serving our community, building our business and connecting the world. Our strategy is working, and we have many more opportunities ahead. We’re going to continue investing to deliver great results over the long term.” Los Angeles Times
FB Technical Analysis
Facebook was a strong performer in 2015 gaining 34.16% to close at $104.66. The stock, like much of the market is down so far in 2016 and closed Tuesday below all but the 200-day moving average. That decline may have been arrested by Wednesday’s financial report. We will see. The bullish reaction to Facebook’s earnings vaulted the stock back up into a range between $104 and $108, where it traded for weeks before breaking down along with 2016 market weakness. As always for a possible long trade, I will watch for a bullish market and early FB strength that keeps the stock above pre-market highs. Resistance sits at $105.90, $106.00, $107.00 and $107.25. A volume move through those levels is very bullish and could lead to an assault on all-time highs of $110.65. If continued broad market weakness pulls FB down, it is likely to find support and pause or bounce at each of the whole dollar levels below $105.
Facebook Company Profile
Facebook, Inc. is a social networking company. The Company is engaged in developing products that enables users to connect and share through mobile devices and personal computers. It offers various services focused on people, marketers and developers. It offers various platforms for people to share their opinions, ideas, photos and videos, and to engage in other activities. Its products include Facebook, Instagram, Messenger and WhatsApp. The Facebook mobile app and Website enables people to connect, share, discover and communicate with each other on mobile devices and personal computers. Its Messenger is a mobile-to-mobile messaging application available on iOS and Android phones. Instagram is a mobile application and Website that enables people to take photos or videos, and share them with friends and followers. WhatsApp Messenger is a cross-platform mobile messaging application and allows people to exchange messages on iOS, Android, BlackBerry, Windows Phone and Nokia devices. Google Finance