Business & Investment

What is the right time for FB stocks? By TipRanks

© Reuters. Facebook Big Rating: The Right Time for FB Stocks?

Facebook (FB)’s second-quarter revenues are comfortably driven above sales and revenue estimates. However, in response to second-quarter earnings and sales, stock prices fell 3.6%. In addition, the tech giant provided guidance in the second half of this year. This shows a slight slowdown in earnings.

The share of this tech stock is well above this year’s S & P forecast. The company’s stock price has skyrocketed 33% year-to-date. Facebook’s share price has so far recorded a significant increase throughout the year. But for now, the stock in this growth stock is trading with a conservative valuation. In addition, the recent price target has been raised to $ 500. (See TipRanks Facebook (NASDAQ :) Stock Chart) This writer is bullish on Facebook’s stock price.

So is it the right time to dive into this growth stock? Let’s take a look.

Price increase the goal (NYSE :) Promising growth and profits

According to a second-quarter report, Facebook revenue was up 56% to $ 29.1 billion and ad prices were up 47%. Shared earnings are $ 3.61 per share, 56 cents higher than analysts estimate.

Credit suisse (SIX :) Analyst Stephen Ju has changed Facebook’s pricing target to $ 500. Strong profits from advertising prices help to further increase the company’s revenue. Instagram reels, which are videos like TikTok, will allow FB to drive revenue growth in the next quarter. Facebook’s idea of ​​boosting advertising in different markets helps the company register more profits.

Facebook stock on sale

Facebook is one of the largest technology companies with a market capitalization of $ 1.06 trillion. The company is ready to earn $ 14.08 per share throughout the year. Therefore, the price-earnings ratio is 27.

Reaching earnings per share forecast means a 40% increase in EPS after 2020. In addition, analysts believe FB can grow at double-digit growth rates in 2022. In the current assessment, this doesn’t seem to be the case. It’s tremendous.

The valuation of FB stocks is relatively cheap, but we must not forget the company’s diversity and ability to innovate. The company has significant cash flow, strong fundamentals and an impressive balance sheet. Investors should consider a management team with strong Facebook acquisition skills and advanced skills.

FB stocks may be worth buying

Facebook’s stock price has risen recently, so it’s not realistic for investors to jump in at this time. But there is a strong reason to believe that it is wise to invest in this tech stock now.

One of the most compelling reasons is the low valuation of this tech stock. This stock is trading 27 times more profitably. This is a time when consensus analysts predict that earnings per share will increase by 29% over the next five years.

Facebook has strong business momentum. The tech giant recorded 56% year-over-year revenue growth in the second quarter. Forecasts show that a company’s revenue growth will increase at a decent 37% in the third quarter, as opposed to the same period last year.

In addition, analysts believe that the resumption of the economy could allow FB to witness a strong and continuous increase in earnings in the third quarter of 2021.

What do analysts say about FB stocks?

Facebook stocks are a strong buy, according to TipRanks analyst rating consensus. Of the 28 analyst ratings, there are 24 purchases and 4 pending recommendations.

Analysts’ Facebook average price target is $ 424.89. Analysts’ price targets range from a low of $ 381 per share to a high of $ 500 per share.

Conclusion

Indeed, Facebook is a fast-growing stock and seems to be attractive now, based on current ratings and fundamentals. Stocks can be traded sideways or fall in the short term. Nevertheless, stocks may be traded at a premium valuation in the future.

Disclosure: At the time of issuance, Chris McDonald did not have a position in any of the securities listed in this article.

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What is the right time for FB stocks? By TipRanks

https://www.investing.com/news/stock-market-news/facebooks-great-valuation-right-time-for-fb-stock-2608229 What is the right time for FB stocks? By TipRanks

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