NEW YORK (TheStreet) -- Facebook (FB) - Get Report stock is slumping by 0.21% to $97.14 this afternoon, as analysts warn of potential drawbacks while nonetheless forecasting for a year-over-year increase in both earnings and revenue for 2015 fourth quarter. The company will release its latest financial results after the market close today.
The social network's expenses likely outpaced revenue during 2015, Bernstein cautions, according to the Wall Street Journal. The firm estimates that Facebook's expenses increased by 52% while revenue rose just 40%.
Investors will be watching the performance of products such as Facebook Messenger, WhatsApp and the Oculus VR for indications of the company's future growth, the Journal adds.
Also of note will be Facebook's average revenue per user (ARPU), or how much money the company makes off of its existing users. The company's ARPU grew 10% in the second quarter and 7.6% last quarter, according to Re/code.
The broader environment might be a factor as well, with Facebook possibly reducing its 2016 forecast to reflect macroeconomic uncertainties, according to MarketWatch. SunTrust Robinson Humphrey analyst Bob Peck lowered his price target on the stock to $120 from $125 this week in light of this possibility.
However, Wall Street remains largely optimistic about the company.
Analysts surveyed by Thomson Reuters have forecast for earnings of 68 cents per share on revenue of $5.36 billion for the quarter. If the company reaches those levels, it would have earned $17.45 billion in fiscal 2015, a 40% year-over-year increase.
In the below video, Jim Cramer encourages investors to decide whether to purchase Facebook stock based on the company's 2017 numbers, where it's "actually not that expensive."
Separately, TheStreet Ratings team rates the stock as a "buy" with a ratings score of B+.
Facebook's strengths such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, growth in earnings per share and expanding profit margins outweigh the fact that the company has had somewhat disappointing return on equity.
You can view the full analysis from the report here: FB
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 article's author.