Facebook Inc

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FB : NASDAQ : Technology
$121.63 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 22,194,300
07/25/16 - 4:00 PM ET

Financial Analysis


FACEBOOK INC's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income significantly, outpacing the average growth rates of competitors within its industry. FACEBOOK INC is extremely liquid. Currently, the Quick Ratio is 12.70 which clearly shows the ability to cover any short-term cash needs. FB managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 25.72% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)5382.03543.0
EBITDA ($mil)2561.01390.0
EBIT ($mil)2009.0933.0
Net Income ($mil)1510.0512.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)20621.012413.0
Total Assets ($mil)52075.042007.0
Total Debt ($mil)0.0186.0
Equity ($mil)47150.037501.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin94.6994.44
EBITDA Margin47.5839.23
Operating Margin37.3326.33
Sales Turnover0.380.32
Return on Assets8.996.68
Return on Equity9.937.49
Debt Q1 FY16 Q1 FY15
Current Ratio13.168.59
Debt/Capital0.00.0
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)2860.02806.0
Div / share0.00.0
EPS0.520.18
Book value / share16.4913.36
Institutional Own % n/a n/a
Avg Daily Volume2.243859E73.4861488E7

Valuation


BUY. FACEBOOK INC's P/E ratio indicates a significant premium compared to an average of 39.31 for the Internet Software & Services industry and a significant premium compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 7.32 indicates a significant premium versus the S&P 500 average of 2.81 and a significant premium versus the industry average of 5.44. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, FACEBOOK INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
FB 74.45 Peers 39.31   FB 34.86 Peers 26.21

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

FB is trading at a significant premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

FB is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
FB 25.77 Peers 20.61   FB 0.41 Peers 0.25

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

FB is trading at a significant premium to its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

FB trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
FB 7.32 Peers 5.44   FB 57.28 Peers 35.70

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

FB is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

FB is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
FB 17.45 Peers 8.94   FB 46.34 Peers 26.18

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

FB is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

FB has a sales growth rate that significantly exceeds its peers.

 

 

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