NEW YORK (TheStreet) -- Shares of Facebook (FB) - Get Report were falling in pre-market trading on Friday after the company exaggerated the average viewing time for advertisement videos on its website.
The social media company said that for the past two years it has been factoring in video views of three seconds or more, artificially inflating the average time people spend watching ads, the Wall Street Journal said. The Menlo Park, CA-based company disclosed this on its "Advertiser Help Center" page a few weeks ago.
The earlier counting method had overestimated viewing time by between 60% and 80%, ad buying firm Publicis Media said.
Large ad buyers and marketers are upset with Facebook, sources told the Journal.
Facebook will introduce a new metric to fix the issue.
The company said that it did not impact billing for advertisers. But the miscalculated data could have affected video advertisers' decisions to spend money on ads on the site, the Journal notes.
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Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of A-.
The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.
You can view the full analysis from the report here: FB