Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Facebook Inc Class A as such a stock due to the following factors:
- FB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $1.7 billion.
- FB is down 4.2% today from today's close.
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More details on FB:
Facebook, Inc. operates as a social networking company worldwide. It provides a set of development tools and application programming interfaces that enable developers to integrate with Facebook to create mobile and Web applications. FB has a PE ratio of 72.4. Currently there are 28 analysts that rate Facebook Inc Class A a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Facebook Inc Class A has been 24.5 million shares per day over the past 30 days. Facebook Inc Class A has a market cap of $172.3 billion and is part of the technology sector and internet industry. The stock has a beta of 0.74 and a short float of 1.6% with 1.29 days to cover. Shares are down 2.9% year-to-date as of the close of trading on Tuesday.
rates Facebook Inc Class A as 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 and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the stock itself is trading at a premium valuation.
Highlights from the ratings report include:
- FB's very impressive revenue growth greatly exceeded the industry average of 28.5%. Since the same quarter one year prior, revenues leaped by 59.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- FB's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 12.65, which clearly demonstrates the ability to cover short-term cash needs.
- Powered by its strong earnings growth of 76.47% and other important driving factors, this stock has surged by 35.01% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Internet Software & Services industry and the overall market, FACEBOOK INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Facebook Inc Class A Ratings Report.