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

Facebook's Mobile Move

Facebook introduced Gifts in the quarter, allowing users to send gifts to other users for special occasions, or just because. Anmuth believes that Gifts will not have a meaningful impact in the near term, as Gifts is only in the U.S. market, but could be huge over time.

"If 10% of U.S. users purchased $20 gifts 4 times per year in 2013, we estimate it would equal nearly $100M of revenue for Facebook," Anmuth wrote.

Payments-related revenue is the other major source of revenue outside of advertising, with Facebook collecting a percentage of gaming and other payment-related revenue done on its Web site. The majority of Facebook's Payments revenue come from Zynga (ZNGA - Get Report), but the relationship between the two companies has weakened over time. In November, the two companies amended their agreement so that Zynga will no longer have to display Facebook ads or use Facebook payments on its own Zynga.com properties. Under the amended deal, Facebook can also develop its own games.

With Zynga performing so poorly, Raymond James analyst Aaron Kessler isn't expecting much from Payments revenue this quarter. "We remain more cautious on Payments and other revenues over the near term given the slower outlook for gaming revenue growth. As such, we are modeling essentially flat growth in 2013 for Payments and Other revenues," Kessler wrote in a report. He rates Facebook "outperform" with a $38 price target.

There's been increased optimism surrounding Facebook since the last earnings report, as CEO Mark Zuckerberg and his team seem to have given Wall Street what they want. We'll find out after the close Wednesday whether the trend continues.

Interested in more on Facebook? See TheStreet Ratings' report card for this stock.

-- Written by Chris Ciaccia in New York

>Contact by Email.

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
FB $86.88 1.30%
GOOG $521.56 0.20%
ZNGA $2.84 -0.87%
AAPL $126.48 0.84%
TSLA $268.99 0.27%

Markets

DOW 17,759.44 +139.93 0.79%
S&P 500 2,075.05 +11.94 0.58%
NASDAQ 5,006.8830 +20.0160 0.40%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs