How Will European Union's WhatsApp Approval Affect Facebook (FB) Stock Today?

NEW YORK (TheStreet) -- Shares of Facebook  (FB) were down 1.51% to $77.35 in morning trading Thursday amid news European Union antitrust regulators would approve the social media company's $19 billion offer for messaging service WhatsApp, according to Reuters.

One source described the approval as "unconditional clearance."

The deal would be the largest in Facebook's 10-year history and would give the social media company a position in the emerging mobile messaging market against large telecommunications companies.

Must Read: Warren Buffett's 25 Favorite Stocks

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Separately, TheStreet Ratings team rates FACEBOOK INC as a "hold" with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate FACEBOOK INC (FB) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. 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 analysis by TheStreet Ratings Team goes as follows:

  • FB's very impressive revenue growth exceeded the industry average of 43.9%. Since the same quarter one year prior, revenues leaped by 60.5%. 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 0.02 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 12.48, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has slightly increased to $1,341.00 million or 1.43% when compared to the same quarter last year. Despite an increase in cash flow, FACEBOOK INC's cash flow growth rate is still lower than the industry average growth rate of 41.67%.
  • 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 analysis from the report here: FB Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

If you liked this article you might like

Shorting Facebook; Top Rope Elbow Drop on Wells Fargo: Doug Kass' Views

Why Amazon's Reported Smart Glasses Might Be Just a Niche Product -- For Now

PayPal's Venmo Gets Ready to Take on Apple

How PayPal's CEO Uses Military Level Karate to Succeed in Business

Yes, PayPal CEO Actively Practices Martial Arts