Facebook Inc

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FB : NASDAQ : Technology
$139.53 -0.06 | -0.04%
Today's Range: 139.09 - 140.39
Avg. Daily Volume: 1.79944E7
03/23/17 - 4:00 PM ET

Financial Analysis

FACEBOOK INC's gross profit margin for the fourth 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 11.63 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 33.86% 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 Q4 FY16 Q4 FY15
Net Sales ($mil)8809.05841.0
EBITDA ($mil)5160.03138.0
EBIT ($mil)4546.02595.0
Net Income ($mil)3568.01561.0

Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)29449.018434.0
Total Assets ($mil)64961.049407.0
Total Debt ($mil)0.0315.0
Equity ($mil)59194.044218.0

Profitability Q4 FY16 Q4 FY15
Gross Profit Margin95.0795.19
EBITDA Margin58.5753.72
Operating Margin51.6144.43
Sales Turnover0.430.36
Return on Assets15.727.46
Return on Equity17.268.34
Debt Q4 FY16 Q4 FY15
Current Ratio11.9711.25
Interest Expense0.00.0
Interest Coverage0.00.0

Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)2892.02845.0
Div / share0.00.0
Book value / share20.4715.54
Institutional Own % n/a n/a
Avg Daily Volume1.7535892E72.1985248E7


BUY. This stock's P/E ratio indicates a premium compared to an average of 38.31 for the Internet Software & Services industry and a significant premium compared to the S&P 500 average of 26.73. Conducting a second comparison, its price-to-book ratio of 6.84 indicates a significant premium versus the S&P 500 average of 2.98 and a premium versus the industry average of 5.42. 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.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
FB 40.11 Peers 38.31   FB 25.13 Peers 26.65

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

FB is trading at a valuation on par with its peers.


Average. 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 valuation on par to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
FB 20.89 Peers 17.98   FB 0.73 Peers 0.32

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.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
FB 6.84 Peers 5.42   FB 172.65 Peers 54.01

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.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
FB 14.65 Peers 9.21   FB 54.16 Peers 30.83

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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