This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Analysts Flocking to Cover Facebook

Facebook estimates that its net proceeds from the sale of its common stock will be approximately $5.67 billion, assuming an IPO price at the midpoint of its range.

The company's advertising business is attracting plenty of attention prior to its IPO. Advertising accounted for 85% of Facebook's total 2011 revenue.

In a note released on Monday, Evercore Partners placed a valuation of $140 billion to $160 billion on the social networking giant, thanks to the potential of its advertising business.

Evercore analyst Ken Sena explained that several changes are underway in Facebook's advertising operation, prompting the high valuation. " Facebook's display business will give way to sponsored content faster than anticipated," he said, citing its high Return on Investment (ROI) for marketers and suitability for mobile devices.

Facebook, according to Sena, is also creating an "ad network" for publishers, which converts them into advertisers through "enhanced" sponsored features. "Instead of Facebook managing their partners' ad sale needs, Facebook manages their viral distribution needs for a portion of revenues," he added.

Evercore Partners has not yet initiated coverage on Facebook.

Sterne Agee analyst Arvind Bhatia initiated coverage on Facebook with a buy rating and a $46 price target on Monday.

In his note, Bhatia says that Facebook's IPO is worth the risk, predicting that the company could be as disruptive as Google.

-- Written by James Rogers in New York.

>To follow the writer on Twitter, go to http://twitter.com/jamesjrogers.

>To submit a news tip, send an email to: tips@thestreet.com.

Check out our new tech blog, Tech Trends. Follow TheStreet Tech on your wireless devices.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
GOOG $540.11 0.00%
AAPL $132.54 0.00%
FB $80.54 0.00%
TSLA $247.73 0.00%
YHOO $43.48 0.00%

Markets

DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs