Facebook in class of its own as ad revenue soars

Thu Apr 28, 2016 5:21pm EDT
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By Tenzin Pema and Supantha Mukherjee

(Reuters) - Wow.

After underwhelming results from Apple Inc, Google Inc and other big tech names, investors finally found a friend in Facebook Inc after the company shredded Wall Street's forecasts for revenue, profit and user growth.

Facebook's shares, which touched a record high of $120.79 on Thursday, closed up 7.2 percent at $116.73, giving a $22 billion boost to the social networking company's market value.

"FB remains in a class by itself across the combination of scale, growth, and profitability," J.P. Morgan Securities analyst Doug Anmuth said in a research note.

"While there are broader concerns of macro softness toward the end of 1Q, Facebook isn't seeing them."

Apple lost about $36 billion in market value on Wednesday after it reported disappointing earnings the previous day, while Alphabet shed nearly $30 billion after missing expectations.

Analysts don't see Facebook's growth slowing anytime soon as it grabs a bigger share of the advertising market, particularly on mobile devices.

At least 26 brokerages raised their price targets on Facebook's stock, with RBC the most bullish at $165. The median price target is $145, according to Thomson Reuters data.   Continued...

Facebook CEO Mark Zuckerberg holds a pair of the touch controllers for the Oculus Rift virtual reality headsets on stage during the Facebook F8 conference in San Francisco, California April 12, 2016. REUTERS/Stephen Lam