Stock Market News Today 2018/09/14
Facebook Inc. shares continued to lag behind FANG counterparts on Thursday after a pair of analysts took opposing sides on the stock. Vertical Group says fears that the company’s revenue growth will be hurt by a shift to newer products and data privacy changes are over-exaggerated, while Cleveland Research cut sales estimates for the current quarter, citing lower spending from advertisers. Facebook fell 0.3 percent as of 12:19 p.m. in New York, while Amazon.com Inc., Netflix Inc. and Google parent Alphabet Inc. traded higher.
Facebook is the only member of the group that’s lost value in 2018, as data privacy scandals and scrutiny over its role in election meddling have weighed on user growth and spurred greater spending on things like security. Facebook has lost about 8 percent so far this month and is on track to close at its lowest since April.
The social media behemoth is expanding photo and video fact-checking capabilities to all of its 27 third-party fact-checking partners, the company said in a blogpost on Thursday. Facebook is much “better protected” against political sabotage today than two years ago, Chief Executive Officer Mark Zuckerberg said in a separate post published on Wednesday, where he detailed the steps the company has made to remove fake accounts and boost security on its popular properties.
Facebook (FB) closed at $161.36 in the latest trading session, marking a -0.42% move from the prior day. This move lagged the S&P 500’s daily gain of 0.53%. At the same time, the Dow added 0.57%, and the tech-heavy Nasdaq gained 0.75%. Coming into today, shares of the social media company had lost 9.76% in the past month. In that same time, the Computer and Technology sector gained 0.86%, while the S&P 500 gained 2.16%.
Wall Street will be looking for positivity from FB as it approaches its next earnings report date. This is expected to be November 7, 2018. In that report, analysts expect FB to post earnings of $1.48 per share. This would mark a year-over-year decline of 6.92%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.83 billion, up 33.94% from the year-ago period. Digging into valuation, FB currently has a Forward P/E ratio of 22.89. Its industry sports an average Forward P/E of 32.9, so we one might conclude that FB is trading at a discount comparatively.
Investors should also note that FB has a PEG ratio of 1.04 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Internet – Services industry currently had an average PEG ratio of 2.45 as of yesterday’s close.