Nor the growing threat from Apple Inc. as its main competitor, nor a furious pandemic, the runaway train of Facebook Inc. and Snap Inc. and Twitter Inc. take advantage of strong trading on Thursday.
Facebook FB,
Wednesday flew past Wall Street estimates with sales up 33% to $ 28.07 billion and earnings of $ 11.22 billion, or $ 3.88 a share. As expected, ads accounted for the vast majority of Facebook’s sales, but “other revenues,” such as Oculus VR headsets and Portal video chat devices, skyrocketed 156% to $ 885 million.
“[Facebook] The results of 4Q20 are accurate across the board, like [advertising] sales were up 31% year over year, helped by a [advertising] recovery and extended holidays; [management] expects 1Q to remain stable or ‘accelerate modestly’, ”said Cowen analyst John Blackledge in a note late Wednesday that maintained an outperform rating and raised Facebook’s price target from $ 340 to $ 350.
UBS analyst Eric Sheridan supported that view, raising his Facebook price target from $ 330 to $ 350 from $ 330, citing “exiting ’20 with momentum” in a note Thursday.
“Involvement with the whole family of apps is very impressive,” Jefferies analyst Brent Thill said on Wednesday in a note that maintains a buy rating and a price target of $ 330. He highlighted 2.6 billion daily active people across the Facebook portfolio, versus 3.3 billion monthly active people suggests that 79% use a Facebook service on a daily basis.
Facebook shares are up 1% to $ 274.55 on Thursday afternoon trading. Over the past year, they are up 31%, while the S&P 500 index SPX,
is up 16%.
The erupting holiday quarter appears to have benefited not only Facebook, but its brethren on social media. Evercore ISI Analyst Kevin Rippey Expects Snap SNAP,
to deliver between 65% and 70% sales growth when it reports the results. February 4th. A strong fourth quarter, he said, will accelerate Snap’s path to more than $ 10 billion in revenue by 2025.
Wells Fargo underscored his fate in Snap, raising his price target from $ 44 to $ 62.
Snap shares are up 11% during early afternoon trading.
Meanwhile, KeyBanc Capital Markets analysts Justin Patterson and Sergio Sugura have upgraded Twitter TWTR,
to overweight sector weight and set a price target of $ 65 in a note to customers Wednesday. They noted that the company’s “growing pains are coming to an end.”
Twitter shares are up 7.5% in early afternoon trading.
Still, not all is rosy for Facebook on its way to 2021.
“We are seeing more and more Apple AAPL,
as one of our biggest competitors, ”Facebook CEO Mark Zuckerberg warned in a conference call with analysts following the news of the earnings. And Chief Financial Officer David Wehner warned the company is facing “greater ad targeting headwinds in 2021. This includes the impact of platform changes, particularly [Apple] iOS 14, as well as the changing regulatory landscape. ”
Read more: Facebook exceeds expectations but warns of ‘cross-flows’ in 2021
Baird Equity Partners analyst Colin Sebastian picked up the thread of the warnings in a note late Wednesday, awarding an outperform rating and a target price of $ 310.
“Management, as expected, sounded cautious about difficult Y / Y growth connections in 2H21 and the potential negative impact of data privacy / headwinds in iOS 14,” Sebastian said in a note to customers. “In addition, flattening user growth in a few key markets means revenue growth will be more dependent on frequency of use / time spent and / or higher ad prices (increasing ARPU).”