Facebook Soars on Strong Earnings: Tech Winners & Losers

NEW YORK (TheStreet) –– Facebook (FB) shares shot up 7.3% to $76.45 after the company reported strong second-quarter earnings.

Facebook reported yesterday it earned 42 cents a share on $2.91 billion in revenue, a 61% increase from the same quarter last year. $2.68 billion of the Menlo Park, Calif.-based company's revenue was from advertising, a 67% increase year-over-year; 62% of advertising revenue was from mobile, up 41% year-over-year. Analysts polled by Thomson Reuters forecasted 32 cents a share on $2.81 in revenue.

The social network averaged 829 million daily active users (DAUs) in June 2014, a 19% increase year-over-year, while mobile DAUs during the same period increased 39% year-over-year to 654 million. Monthly active users (MAUs) and mobile MAUs increased 14% and 31% year-over-year, respectively; both topped 1 billion. Facebook ended the quarter with $13.96 billion in cash and marketable securities.

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In response to the results, several analysts upgraded their ratings of Facebook stock. Jefferies analysts maintained their “buy” rating and raised the price target to $100 from $85, citing margin expansion. Wells Fargo analysts reiterated their “outperform” rating and raised the price target to $85-$87 from $78-$80, highlighting Facebook’s strong user growth and monetization. Analysts at Credit Suisse reiterated their “outperform” rating and raised the price target to $92 from $90, noting strong mobile advertising revenue growth. Sterne Agee analysts, who also cited digital advertising, reiterated their “buy” rating and raised the price target to $85 from $80.

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